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6 Months : From Nov 2017 to May 2018
By Jeffrey A. Trachtenberg
Barnes & Noble Inc. is laying off a significant number of workers, including experienced cashiers and staffers who sell the retailer's Nook e-readers and tablets, as a result of poor holiday-season results.
The bookseller, which declined to say how many staffers are being cut, said in a securities filing that it will take a charge of about $11 million in its third fiscal quarter ended Jan. 27 related to severance costs.
The retailer said the layoffs, which will also affect people involved in receiving products into stores, are expected to be completed by Friday and should save about $40 million annually.
The country's largest publicly traded bookstore chain has struggled in recent years as its largest rival, Amazon.com Inc., gained market share, both in physical and digital books.
For the nine-week holiday period ended Dec. 30, comparable-store sales fell 6.4% and online sales declined 4.5%. In recent quarters, the bookseller has struggled to generate revenue growth even as it has opened two new stores and focused on getting more shoppers to make actual purchases.
In morning trading, Barnes & Noble shares were flat, but are down about 30% from the start of the year. The company reports quarterly results on March 1.
The layoffs are the most significant action taken by Barnes & Noble to address its declining revenue since Demos Parneros was named chief executive in April 2017. Mr. Parneros has said the chain will focus more attention on books with a narrowing of the rest of the product assortment.
"What I'm not sure about is whether this makes them a better business," said John Tinker, an analyst with Gabelli & Co. "The problem for them is that the industry is expanding, both independent stores and new stores from Amazon. In an increasingly digital marketplace, other companies have figured out interesting ways of selling books."
Barnes & Noble has already downsized considerably over the past several years, closing stores and cutting jobs. It employed 26,000 employees at 633 stores as of April 2017, down from 40,000 workers at nearly 800 stores in 2008.
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(END) Dow Jones Newswires
February 13, 2018 11:31 ET (16:31 GMT)
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