Barnes & Noble (BKS) reported a sharp drop in the fiscal first quarter of 2019 as same-store sales skidded lower and the bookseller said it’s trying to focus on growing revenue into the holiday season to stem the slide.
The first-quarter net loss was $0.23 per share, more than double the consensus on Capital IQ for a loss of $0.10 and wider than the year earlier loss of $0.15. Revenue decreased by 6.9% to $795 million, below the Wall Street view for $832.4 million.
In the three months, comparable-store sales dropped 6.1%, but the company said the losses narrowed as the months progressed. The sales fell 7.8%, 6.1% and 4.5% over the months through July 28, and were down just 0.8% in August.
“We fully realize that cutting expenses does not alone provide a path to the long term viability of any retail business,” Len Riggio, the company’s chairman and founder of the chain that has 630 stores around the world. “Our short and long term focus is to grow our top line, and, by doing so, provide us the cash flow needed to grow our business.”
Barnes & Noble has faced steadily declining revenue amid the rise of e-commerce sales driven by rival Amazon.com (AMZN). Shares in the New York City-based firm have plunged 31% this year. While Barnes & Noble said it’s preparing for the holiday season, same-store sales in the period for 2017 dropped 6.4% and online sales fell 4.5%.
Still, heading into the holiday period, the retailer “is encouraged by the sequential improvement in its sales trend and the fall title line-up,” it said in the statement. “The organization is focused on its merchandising initiatives to grow sales, while continuing to control expenses.”
The company maintained its view for fiscal 2019, earnings before interest, taxes, depreciation and amortization to be between $175 million to $200 million. That compared with EBITDA in fiscal 2018 of $145.4 million.