Quote:
Originally Posted by SensualPoet
B&N's challenge is simply that it is not profitable. It cut out its dividend at the end of last year because it would have had to borrow money to pay it. In the most recent quarter, the sales in the digital division were swamped by expenses in the digital division by a margin of 2 to 1 (if memory serves).
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Quote:
Originally Posted by jocampo
Now, if B&N, as per your previous comment, was doing well this year, that is not what the stock shows and what even managers were saying few months ago. In fact, they are not, they are losing money, regardless of how many NC they sold. It's not a profitable as it was before.
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I have no idea where you get the idea I ever claimed B&N was "doing well" ... I definitely believe B&N has an uphill battle to
survive the next 36 months.
Quote:
Originally Posted by stonetools
Right now, B&N's best course is to project confidence ( " We can take Amazon's punch. And we've got an October surprise of our own"). They'll roll out the NC2 ( " better than the KF.... which copied the NC1") and hang on. They can hope that the digital division gets profitable and pulls them out of the ditch, while they stealthily implement their plan to close down the unprofitable stores. Will this work? Maybe not... but it's the only shot they got.
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Most public companies have a public strategy / plan of how they intend to get from A to B. My point is B&N has nothing that I have seen that gets them from 1300+ currently barely profitable stores to somewhat fewer and somewhat more profitable stores. It represents $6 billion of their $7 billion business. If management isn't addressing that, its hard to imagine them suddenly being successful.
Nook Color has done well in terms of brand positioning; Nook Color 2 no doubt will continue to help; but B&N still needs to demonstrate it can actually make money with it.