Thursday, August 16, 2012

Earnings Preview: B&N 1Q an update on Nook

NEW YORK (AP) ? Barnes & Noble Inc., the largest traditional U.S. bookseller, will provide an update how its Nook business is doing when it reports its fiscal first-quarter earnings before the market opens on Tuesday, offering a snapshot of the rapidly changing book business.

WHAT TO WATCH FOR: Barnes & Noble, the largest traditional U.S. bookseller, has been has been investing heavily in its e-book reader and e-book library to offset tough competition from online retailers and discount stores.

Meanwhile, more and more Americans are buying digital books. The New York company struck a deal in April with Microsoft Corp. Microsoft will invest $300 million to help create a subsidiary for Barnes & Noble's e-book and college textbook businesses. Microsoft receives a 17.6 percent stake in the venture. Investors will be looking for an update on that.

An update on international expansion for the Nook will be likely as well. B&N plans to introduce Nook in several undisclosed international markets by the holidays.

WHY IT MATTERS: Barnes & Noble's sales of books and e-books can give a hint to how well the publishing industry is doing and how it is evolving. Also, if people are spending more on discretionary items like books, that's important because consumer spending accounts for 70 percent of all economic activity.

WHAT'S EXPECTED: Analysts surveyed by FactSet expect a loss of 96 cents per share on revenue of $1.48 billion in the quarter ended in July.

LAST YEAR'S QUARTER: The company reported a net loss of 99 per share on revenue of $1.42 billion in the fiscal first quarter a year ago.

Source: http://news.yahoo.com/earnings-preview-b-n-1q-nook-111552005--finance.html

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