Barnes & Noble reported record holiday sales today for its Nook business, including devices and digital content.
“During the nine-week holiday period ending Dec. 31, 2011, Nook unit sales, including Nook Simple Touch, Nook Color and the new Nook Tablet, increased 70 percent over the same period last year,” said the bookseller in a Jan. 5 statement. “Digital content sales also grew briskly during the same nine-week period, increasing 113 percent on a comparable basis.”
Content sales include digital books, digital newsstand, and the company’s apps business. The retailer of digital media and educational products is doing so well, as of lately, it is even considering a spinoff.
The company announced on Thursday it is embarking on a “strategic exploration” to separate the Nook division. The retailer also wants to report Nook-related sales as a separate business segment, and it is communicating with potential partners to expand the Nook’s presence abroad…
“In order to capitalize on the rapid growth of the Nook digital business, and its favorable leadership position in the expanding market for digital content, the company has decided to pursue strategic exploratory work to separate the Nook business,” Barnes & Noble explained.
However, a spinoff would raise questions about Barnes & Noble’s future. Holiday sales for the Nook, including both devices and digital content, according to the company’s statement, jumped 43 percent from the same period last year. Meanwhile, the company’s store sales only slightly rose 2.5-percent.
Barnes & Noble expects to report a loss of $1.10 to $1.40 a share for this year, which would send company shares plummeting 30 percent in premarket trading. Despite such a meager fate, the company predicts a plentiful future for the Nook, because it has successfully endured many quarterly losses while investing in the e-reader business.
“We see substantial value in what we’ve built with our Nook business in only two years, and we believe it’s the right time to investigate our options to unlock that value,” said William J. Lynch Jr., Barnes & Noble’s chief executive, in a statement. “Between continued projected growth in the U.S., and the opportunity for NOOK internationally in the next 12 months, we expect the business to continue to scale rapidly for the foreseeable future.”
Noble’s chief executive said Nook business is growing rapidly “year-over-year” and should be approximately $1.5 billion in comparable sales this fiscal year. The Nook’s numbers were not all jovial, however. The bookseller acknowledged it ordered too many black-and-white Nook devices that fell short of sales expectations.
All Nook tablets run on custom versions of Google’s Android operating system.