- CFO Joseph Lombardi is cautious but guardedly optimistic about sales in the all-important fourth quarter, saying that “the hardcover book business has improved” but there have been “some recent mixed retail sales reports.”
- Following a slow second quarter, the third quarter saw a turnaround in sales. CEO Steve Riggio said that the increase in sales began with Bob Dylan’s new CD, Modern Times.
- Diane Setterfield’s The 13th Tale was “one of the most successful new hardcovers… The wonderful ghostly tale was our number one bestseller the first day it went on sale, and the book went on to break all previous Barnes & Noble sales records for a first-time novelist. Almost 60 days after publication, the book is still one of our top-selling titles, due to its word-of-mouth appeal.”
- Fiction bestsellers for the quarter were Mitch Albom’s For One More Day, Stephen King’s Lisey’s Story, Nicholas Sparks’ Dear John, David Baldacci’s The Collectors, and “rising fiction star” Vince Flynn’s Act of Treason.
- On the nonfiction side, the bestsellers were John Grisham’s The Innocent Man, Bob Woodward’s State of Denial, Nora Ephron’s I Feel Bad About My Neck, and Richard Dawkin’s The God Delusion
- Looking at the fourth quarter, “Among the season’s best gift books, the standout is clearly Annie Leibovitz’s A Photographer’s Life, but Martha Stewart’s Homekeeping Handbook is off to a great start, as is the magnificent coffee table book called Rainforest.”
- In October, Barnes & Noble upped its discounts for shoppers who belong to its member program. The company expects this to help sales, but its inability to say just how the numbers might work out made investors nervous, the issue being that this plan could put a serious dent in the bookseller’s profit margin.
- Having said that, Barnes & Noble also noted that “margins continue to benefit from lower purchasing from book wholesalers, increased sales of our own publications, and an overall more efficient supply chain.” – i.e. those books published by Barnes & Noble are quite lucrative for the company.
Every three months I’ve been looking at Barnes & Noble’s quarterly conference call to get some insight into recent book industry trends and to see which books were the big sellers over the past few months and which are expected to be big in the coming months. Barnes & Noble’s first quarter ended May 5th. Here are the highlights from CEO Steve Riggio on the Q1 conference call (courtesy Seeking Alpha):In keeping with an ongoing trend, Barnes & Noble’s margins were pressured as the chain continues to discount heavily to stave off competition from the likes of Wal-Mart and from Amazon’s popular Amazon Prime program. Nonetheless, Wall Street seemed to like the overall numbers and pushed the stock higher.Sales in both the stores and online were better than expected. “Both benefited from a better new release schedule than we’ve seen in some time.””Rhonda Byrne’s The Secret has the unique distinction of being our bestselling title in hardcover, audio book and DVD.”Riggio said that Mohsin Hamid’s The Reluctant Fundamentalist was the third straight “Barnes & Noble Recommends” selection to “become an instant fiction bestseller upon publication.”Meanwhile, Oprah drove sales of Sydney Poitier’s Measure of a Man and Cormac McCarthy’s The Road.The quarter’s non-fiction bestsellers were Einstein by Walter Isaacson and In an Instant by Bob Woodruff.Looking ahead, Harry Potter and the Deathly Hallows will hit the shelves at the end of Barnes & Noble’s Q2. Khaled Hosseini’s A Thousand Splendid Suns just debuted “with very strong sales.” There’s also new fiction on the way from James Patterson, Nora Roberts, Robert Parker, and Ian McEwen (On Chesil Beach).On the non-fiction side of the ledger, new release The Reagan Diaries is already selling well. A pair of books on Hillary Clinton are coming shortly: A Woman in Charge by Carl Bernstein and Her Way by Jeff Garth. “We expect, of course, many more titles by and about the candidates for the presidential election season to be coming over the next year to 15 months,” Riggio said.
As we have every quarter for the last several, we’re looking at Barnes & Noble’s recent quarterly report to gauge the trends that are impacting the book industry – which books were big over the last few months and what’s expected for the months ahead.As was noted last quarter, amid a challenging environment for both of the big chains, there was much speculation that Barnes & Noble would snap up struggling Borders. Now, it appears that Barnes & Noble has lost interest in going that route. According to the Wall Street Journal, “Barnes & Noble’s decision not to bid reflects in part the tight lending markets that likely would make it difficult to arrange bank financing. The retailer was also known to be concerned about the length of some of the leases that Borders has signed.”Beyond that, Barnes & Noble’s Q2 was surprisingly ok, surpassing Wall Street’s admittedly dim view of its prospects by keeping a tight lid on costs.What follows are insights gleaned from Barnes and Noble CEO Steve Riggio’s comments on the quarterly conference call for the quarter ended August 2nd. (Transcript provided by Seeking Alpha.) The Harry Potter hangover was in full effect in Q2, as it marked a year since the series’ final book came out. Up against the boy wizard-fueled numbers of a year ago, Barnes & Noble’s revenue dipped by -1.6% from a year ago. Just like last quarter, Riggio didn’t really discuss any individual titles, though in the past he has been known to run down top sellers and look ahead to highly anticipated books. It may just be that there’s not much out there getting the book exec excited these days. A couple of other highlights:Riggio explains that the book business may not be in as bad shape as many assume: “The closer examination of sales will reveal that even in this soft retail environment across America, the book business is stubbornly holding up. If we normalized our sales without the impact of Harry Potter and its add on sales last year, throw in the double digit decline we’re still experiencing in the music business, the rest of our business was relatively flat so as we’ve said for many years, the book business is a relatively stable business.”The Olympics are expected to take a small but noticeable bite out of sales in Q3, as folks stay glued to their TVs and put off shopping and reading.
Every three months I’ve been looking at Barnes & Noble’s quarterly conference call to get some insight into recent book industry trends and to see which books the retailer expects to be “big” in the coming months. Here are the highlights from CEO Steve Riggio on the Q4 conference call (courtesy Seeking Alpha):One of the big stories for book retailers this year was a lack of blockbuster titles to get shoppers into stores. “It was a year that produced two titles that garnered significant media attention. But while the lack of traffic producing new releases didn’t help our top line, what’s important is that our core booklist was solid.” I’m not sure which titles he’s referring to there – which says something about last year’s lack of blockbusters – but I’m guessing one of them was Barack Obama’s The Audacity of Hope.Riggio also noted how customer loyalty programs have made for “a vastly different environment than just three years ago,” and he alluded specifically to Amazon Prime, the online retailer’s popular shipping offer.Riggio said the chain has high expectations for new books by Lisa Scottoline (Daddy’s Girl), Jonathan Kellerman (Obsession), Mary Higgins-Clark (I Heard That Song Before), David Baldacci (Simple Genius), Michael Chabon (The Yiddish Policemen’s Union), and Khaled Hosseini’s follow-up to Kite Runner, A Thousand Splendid Suns.”The Oprah effect on books continues.” Oprah helped make YOU: On A Diet, Bob Greene’s Best Life Diet, and The Measure of a Man by Sidney Poitier. But the really big seller – much to the chagrin of many – was The Secret by Ronda Burn, which Riggio called “probably one of the fastest non-fiction selling books we’ve had in recent memory.”B&N is also looking forward to some new non-fiction titles: Einstein by Walter Isaacson, Where Have All the Leaders Gone? by Lee Iococca, Animal, Vegetable, Miracle: A Year of Food Life by Barbara Kingsolver, and Paula Dean’s memoir, It Ain’t All About the Cooking.Finally, “we are just beginning to see a wave of books about politics and those related to the 2008 Presidential election at this time and by far, Barak Obama’s The Audacity of Hope leads the pack.”Previously: Barnes & Noble’s third quarter.
As we have every quarter for the last several, we’re looking at Barnes & Noble’s recent quarterly report to gauge the trends that are impacting the book industry – which books were big over the last few months and what’s expected for the months ahead.This quarter has been rather dramatic for the big chains. In March, Borders took an emergency cash infusion (with many strings attached) from a large hedge fund shareholder just to stay afloat. This came on the heels of a new strategy initiative from the chain, which we dubbed “The Froot Loop Gambit,” leading to some great discussion and a follow-up post about “knowledge products.” Two months on, Borders is out of the woods for the short term, but appears unlikely to survive as a standalone company in the long term. Right now, most are speculating that Borders will be swallowed up by Barnes and Noble.As such, our regular look at Barnes and Noble quarterly updates may offer an even broader view of the book industry as soon as next quarter. Interesting times. In the meantime, what follows are insights gleaned from Barnes and Noble CEO Steve Riggio’s comments on the quarterly conference call for the quarter ended May 5th. (Transcript provided by Seeking Alpha.) Interestingly, this quarter was much lighter on the discussion of individual books that have done well recently or that are expected to do well in current and future quarters. It’s hard to know what to make of this change in tone other than the fact that there appears to be paucity of blockbusters this year compared to the Potter-mania, political memoirs, and self-help tomes that fueled sales in 2007.First quarter numbers compared unfavorably to a year ago when Oprah-backed positive thinking pablum The Secret was a massive seller.Looking ahead, the second quarter will face very tough comparisons to Q2 2007 thanks to the huge sales of Harry Potter a year ago. “the quarter should end with some excitement with the publication of Breaking Dawn by Stephanie Meyer and we think that’s the most anticipated book of this year, if not actually in a couple of years. Even though it’s a teen book, it has wide appeal.”April was difficult but May started out better: “We had a number of big books in the first couple weeks, including Barbara Walters’ Audition, the Stephanie Meyer adult fiction book The Host and the continued strength of the Last Lecture.”As for Riggio’s answer to the Borders question: “We’ve put together a team of senior management people and financial advisors to study the feasibility of a transaction with Borders. We’ll provide no further comments about any discussions we may or may not have.”
I was reading about the recent second-quarter earnings report for Barnes & Noble as part of my day job and I realized how much insight the company’s quarterly conference call provides in terms of current trends in the book industry, as well as which books will be are most likely to be the headline-grabbing titles over the next few months. I may do this each quarter from now on, as I think it’s an interesting proxy for what’s going on in the book industry at a given point in time.The big trend so far this year is a lack of blockbuster titles as compared to years past. From Steve Riggio, Barnes & Noble CEO, on the Q2 conference call (courtesy Seeking Alpha):We look back at the first half of this year as one of the softest periods in recent memory for the book industry in terms of hardcover new releases. There were simply very few new hardcover books that generated media buzz or sustained sales by word-of-mouth recommendations.The lack of blockbusters is thrown into particularly stark light when compared to a year ago, when Harry Potter and the Half-Blood Prince came out. Overall, sales were actually down from last year.Riggio called The Memory Keeper’s Daughter by Kim Edwards “one of the fastest-selling trade paperbacks in our history.”Barnes & Noble also looked ahead to the books that they anticipate will be big in the third quarter of this year. In fiction, Frederick Forsyth, Anna Quinlan, Robert Harris, David Baldacci, Janet Evanovich, and Robert Parker have new books on the way. The company also singled out Mitch Albom’s For One More Day (Riggio said that Albom’s previous book, The Five People You Meet in Heaven, “was the second-largest selling fiction book in our history”) and Charles Frazier’s 13 Moons, while The Thirteenth Tale by Diane Setterfield and The Interpretation of Murder by Jed Rubenfeld “are getting a lot of buzz.”In non-fiction, Barnes & Noble is anticipating big sales from Faith and Politics by Senator John Danforth, The Greatest Story Ever Sold: The Decline and Fall of Truth from 9/11 to Katrina by Frank Rich, Never Again: Securing America and Restoring Justice by John Ashcroft, The Confession by James McGreevey and Inside Bush’s White House, the Second Term by Bob Woodward “continuing his take on the Bush administration and the war.” Riggio also called John Grisham’s first non-fiction book, The Innocent Man: Murder and Injustice in a Small Town, “one of the most eagerly-awaited books we have seen in a very long time.”The company also highlighted several upcoming biographies and memoirs: Bob Newhart, Sandy Weil, Carly Fiorina, Ellen Burstyn and David Crosby. There’s also a “major new biography” on Andrew Carnegie and “the definitive book” on U2.Riggio said it “looks like a very strong season for cookbooks,” with the 75th edition of the Joy of Cooking, a new edition of The Bon Apetit Cookbook and new titles from Paula Dean, Rachel Ray, Emeril Lagasse and the Barefoot Contessa.
As we have every quarter for the last several, we’re looking at Barnes & Noble’s recent quarterly report to gauge the trends that are impacting the book industry – which books were big over the last few months and what’s expected for the months ahead.To a large extent, things have gone from bad to worse for the big booksellers. Sales for the 3rd quarter ended November 1st were down -4.4% from the same quarter a year ago. Store traffic at Barnes & Noble has been declining all year, and in the 3rd quarter, average ticket (i.e., the average amount spent per visit) started falling as well. Having said that, Barnes & Noble is in better shape than rival Borders which has been at risk of running out of cash this year. Barnes & Noble is now focusing on controlling costs, keeping inventory low, and increasing supply change efficiency.What follows are insights gleaned from Barnes and Noble CEO Steve Riggio’s comments on the conference call discussing Q3 results. (Transcript provided by Seeking Alpha.)Riggio noted that this has been a busy year for news, leaving less room for books. Sales have “been affected by lack of coverage of books both in the mainstream media and on cable, news and talk radio, which were all fully devoted to coverage of the Presidential election and then the economic crisis which hit in September.”Riggio claims that inventory reductions are not hurting the shopping experience (though I’d imagine they are hurting publishers): “While inventory levels have decreased, we have maintained outstanding breadth of selection in our stores and online. In fact our in stock standards for what we call core titles have never been higher. We have the books the people need and that they ask for everyday.”Elaborating further on the effect of media coverage on the book industry recently, Riggio said, “Well we’ve obviously seen it in books by President-Elect Barack Obama, which has been fantastic. Publishers actually lightened up their September and October publishing lists because they knew that the election would dominate the media. Obviously no one forecasted the economy as well to dominate the media, but we’re hoping that things get back on track as we enter the holidays and into the January season so that we can continue to get media interest in books.”Continuing last quarter’s trend of not mentioning specific titles (one wonders if the economic challenges are sapping the enthusiasm Riggio had typically shared regarding specific titles in past quarters), Riggio only mentioned a pair of books, the new book from megachurch preacher Rick Warren and Jon Meacham’s presidential biography, American Lion: Andrew Jackson in the White House.Riggio and Barnes & Noble see a silver lining in the tough times facing shoppers heading into the holidays, however. “Books are fairly affordable and we hope that as consumers get into the holiday season they recognize that a purchase of $15 or $20 or $25 can give someone a fairly memorable gift.”