(Adds details on new Nook product)
By Phil Wahba
Feb 26 Barnes & Noble Inc returned to
profitability during the holiday quarter after it scaled back
its money-losing Nook tablets business and its core bookselling
Shares of the company, the largest U.S. bookstore chain,
were up 2.6 percent at $18.19 in premarket trading.
The profit came despite a 10.3 percent decline in overall
revenue. The company last year said it would only produce new
tablets with a partner after it had lost hundreds of millions of
dollars in recent years from trying to compete with the likes of
Amazon.com Inc, Apple Inc and Google Inc
Barnes & Noble has repeatedly said it is not abandoning its
Nook business, whose sales fell 50.4 percent in the third
quarter ended Jan. 25.
The company did not introduce any new tablets ahead of the
holiday season, and it lowered Nook prices to sell off extra
But the company plans to introduce a new Nook color device
sometime after April, saying it is "actively" engaged with
several hardware companies.
The Nook business had been draining the company's resources:
Barnes & Noble had $490 million in cash at the end of the
quarter, up from $276 million a year earlier as it stopped
making new devices and cut staffing levels.
Overall revenue fell 10.3 percent to $2 billion in the
quarter. Sales at stores open at least 15 months dipped 0.5
percent, excluding Nook products such as e-readers, as book
The company posted a net profit of $63.2 million, or 86
cents a share, compared with a year-earlier loss of $3.7
million, or 14 cents a share.
Barnes & Noble's profit got a lift from its college
bookstores, where growth in the higher-margin textbook rental
business more than offset a drop in revenue.
(Reporting by Phil Wahba in New York; Editing by Lisa Von Ahn)