By Leena Rao
Barnes & Noble (NYSE:BKS) has reported earnings for its fiscal 2011 first quarter ended July 31, 2010. Total sales for the first quarter were $1.4 billion, a 21% increase compared to the prior year. Sales increased 42% as compared to the prior year to $145 million. Unsurprisingly, Barnes & Noble in-store sales decreased 2% to $1 billion.
For the first quarter, the company reported a consolidated net loss of $63 million, or $1.12 per share. This was the result, the company says, of legal expenses of $9.5 million involved with B&N’s dispute with Yucaipa over shareholder control. The company has been embroiled in litigation with private equity firm Yucaipa after the firm’s CEO Ron Burkle recently challenged the company’s stockholders rights plan.
Of course digital is now key to B&N’s future, says the company. B&N’s eBook reader, the NOOK, has helped the company gain greater market share in digital books than it has in physical books. ANd eBook sales are accelerating week-over-week, says B&N. The compnay’s customers who have NOOK devices have increased their spending by approximately 20%. NOOK has also greatly expanded the Barnes & Noble customer base, with 25% of all NOOK customers new to BN.com.
B&N has added new leadership to the digital and e-commerce sectors of the company, naming Jamie Lannone as President of Barnes & Noble Digital Products and John Foley as President of Barnes & Noble eCommerce.
Of course, the digital book space is heating up as competitors vie for the biggest piece of the pie. Amazon slashed the price of its Kindle device. And Apple is now playing in the space with iBooks and the iPad. Plus, Google is expected to launch Google Editions, their e-Book platform soon.