As quarterly losses begin to diminish, Barnes & Noble (NYSE:BKS) announced the coming of a new store format.
During a quarterly conference call with investors, CFO Allen Lindstrom announced that total sales decreased 1.8 percent, with retail down 1.2 percent for the quarter, primarily due to lower online sales and store closures. Online, sales declined 12.5 percent, which was an improvement over the 22 percent decline in the previous quarter.
However, Barnes & Noble reported a comparable store sales growth of 1.3 percent on top of a 1.7 percent increase one year ago. The results were strengthened by increased sales in toys, games and gifts, which increased 12.5 percent, and vinyl music, which was up 2.7 times over last year.
Also during the call, CEO Ronald Boire talked of the company's priorities moving forward, which include reducing Nook expenses. In the third quarter, Nook expenses were down by $25 million and Barnes & Noble's planned exit from Nook's app and video business is expected to result in additional cost savings. In 2014, Barnes & Noble separated its retail and Nook businesses into two separate companies.
In 2015, the company also spun off its college bookstore operator, Barnes & Noble Education, into its own entity.
"While we remain committed to providing a great digital reading experience to our customers, we are exploring all opportunities to reduce costs," Boire said.
A second priority laid out was growing the core bookstore and online sales. In a long-term view, Boire said improved trends meant a closing of fewer stores than in the past, about eight—the lowest level of store closings since fiscal 2000.
"As we look out to fiscal 2017, we are excited by the work on our new store concept. We plan to open four new stores during fiscal 2017 with the first new concept store opening in late summer. We plan to share additional details about our new stores in the month ahead. Including the new concept stores, our fiscal 2017 net store closings will be approximately 10 stores," Boire said.
Boire also noted the big opportunity that lies in the e-commerce site and was encouraged by the site's improved performance during the quarter. He noted several projects to improve the user experience on desktop and "investments to improve our mobile and tablet experience."
"Today, over half of our site traffic is driven by mobile. We will improve our mobile experience to provide a great experience, whether it'd be on a phone or a tablet," he added.
-See this Seeking Alpha transcript
Barnes & Noble Education considering digital acquisitions
Barnes & Noble partners with Flashnotes to beef up college business
Barnes & Noble to separate retail, Nook
Barnes & Noble to add 300 campus stores
Barnes & Noble receives stake offer worth $661 million