Barnes & Noble warns on Nook sales declines


Barnes & Noble warned Wall Street that its Nook Media business will perform worse for the fiscal year ending April 27 than previously forecast. The bookseller cautions that the Nook unit--including tablets, e-readers and e-books--faces EBIDTA losses greater than its fiscal 2012 losses of about $262 million. Barnes & Noble adds that Nook Media revenues for 2013 will total less than $3 billion; last month, it anticipated revenues around the $3 billion mark.

"Even though the Nook compares well with many of its competitors' tablets, Barnes & Noble's distribution channel and marketing of its products is nowhere near like those of [Apple, Google and Amazon ]," said Yankee Group Senior Analyst Boris Metodiev. "One problem for Barnes & Noble is that most people think of the company only as a book retailer--having good e-readers seems reasonable; manufacturing good tablets seems a bit of a stretch. And the e-reader market will continue to be suffocated by the plethora of 7-inch cheap tablets. Another thing that doesn't help the popularity of the Nook is that it runs on Android's Gingerbread OS (version 2.3) which makes it quite outdated and unattractive for the consumer, compared to most other popular Android tablets running on Ice Cream Sandwich (version 4.0) or Jelly Bean (version 4.2)." Article