Tags: Barnes | Noble | Nook | book

Barnes & Noble May Split Off Nook, Cuts Forecast

Thursday, 05 Jan 2012 09:09 AM

Bookstore owner Barnes & Noble Inc. on Thursday said it is considering splitting off its Nook electronic reader business and also cut its full-year earnings forecast, citing a shortfall in sales of its basic touch screen reader.

Shares of Barnes & Noble fell 27 percent to $9.88 in premarket trading.

The company, which has been battling Amazon.com's Kindle platform in the growing e-reader market, also cited higher advertising costs and costs for international expansion in cutting its forecast for earnings before interest, taxes, depreciation and amortization to $150 million to $180 million for the year.

A month ago, the company said that measure would be at the low end of its previous $210 million to $250 million forecast range.

The company did say that sales of Nook readers rose 70 percent during the nine weeks ended December 31, compared with a year earlier and that sales of digital content, including books, apps and newspapers and magazines, rose 113 percent on a comparable basis.

"We see substantial value in what we've built with our Nook business in only two years, and we believe it's the right time to investigate our options to unlock that value," William Lynch, chief executive officer of Barnes & Noble, said in a statement.

© 2017 Thomson/Reuters. All rights reserved.

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