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Loss widens at Barnes & Noble

Bookseller Barnes & Noble cited its push into the growing electronic book market as it reported an increased loss in the last quarter. Revenue in stores open at least one year fell 3.1 percent. Bookseller Barnes & Noble cited its push into the growing electronic book market as it reported an increased loss in the last quarter. Revenue in stores open at least one year fell 3.1 percent. (Gene J. Puskar/Associated Press)
By Mae Anderson
Associated Press / June 29, 2010

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NEW YORK — Barnes & Noble Inc.’s fiscal fourth-quarter loss widened as it invested in electronic book technology, the bookseller said yesterday.

The New York company also forecast first-quarter and full-year earnings below expectations as it plots aggressive moves into the small but fast-growing e-book market.

The loss for the three months ended May totaled $32 million, or 58 cents per share. That compares with a loss of $2.7 million, or 5 cents per share, last year.

The loss totaled 89 cents per share excluding a tax benefit of 25 cents per share and a benefit related to inventory of 7 cents per share. Analysts polled by Thomson Reuters, on average, predicted a loss of 81 cents per share. Analyst estimates typically exclude one-time items.

Revenue rose 19 percent to $1.32 billion from $1.1 billion last year. Analysts expected revenue of $1.28 billion.

Revenue in stores open at least one year fell 3.1 percent, in line with company guidance of a 2 percent to 4 percent drop. Revenue at stores open at least a year is a key indicator of a retailer’s performance because it excludes growth at stores that open or close during the year.

Barnes & Noble is focusing on e-books and its e-book reader Nook to counter increased online competition and discounters.

Barnes & Noble last week cut the price on its original Nook electronic reader to $199 from $259 and introduced a new Nook Wi-Fi for $149. Amazon.com responded by cutting its price on the Kindle e-book reader to $189.

In March, the company highlighted the importance of the electronic business by elevating the president of its website, William Lynch, to chief executive in a surprise move.

Lynch helped launch the company’s electronic bookstore and oversaw the introduction of the Nook.

Lynch said in a statement that only a year after the Barnes and Noble e-bookstore launched, the company’s share of the digital market already exceeds its share of the retail book market.

For the fiscal year, Barnes & Noble profit fell 52 percent to $36.7 million, or 63 cents per share, from $75.9 million, or $1.29 per share last year.

Revenue rose 13 percent to $5.81 billion from $5.12 billion.

The company expects a first-quarter loss between 85 cents and $1.15 per share on revenue growth of 30 percent to 50 percent. Analysts expect a loss of 44 cents per share.

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