Barnes & Noble Cuts Jobs Following Poor Holiday Season
February 13 2018 - 11:46AM
Dow Jones News
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.
Write to Jeffrey A. Trachtenberg at
jeffrey.trachtenberg@wsj.com
(END) Dow Jones Newswires
February 13, 2018 11:31 ET (16:31 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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