Barnes and Noble announced on Wednesday that they are splitting up into two separate publicly traded companies: one for Barnes & Noble’s retail operations and another for its Nook efforts. The plan is to finalize the split by the end of the first quarter of 2015.
“We believe we are now in a better position to begin in earnest those steps necessary to accomplish a separation of NOOK Media and Barnes & Noble Retail. We have determined that these businesses will have the best chance of optimizing shareholder value if they are capitalized and operated separately,” Michael Huseby, Barnes & Noble CEO, said in a statement Wednesday morning. “We fully expect that our Retail and NOOK Media businesses will continue to have long-term, successful business relationships with each other after separation.”
The Nook posted $87.1 million in fourth quarter revenue, which is a 22% drop over the prior-year period. Overall, on a full-year basis, Nook saw $505.9 million in revenue, a 35% drop compared to 2013′s $780.4 million in full-year sales.
Barnes & Noble has struggled to compete with the iPad and Kindle. It’s unfortunate because I have a Nook and love it – but I don’t think enough people know about it! The company has tried to combat decreased sales on e-books by lowering prices on its existing devices and partnering with other hardware manufacturers like Samsung.
“Being one or two companies doesn’t fundamentally change the market situation that Barnes & Noble faces, which is advanced competition on both sides — both the retail book operation as well as the digital media space,” says James McQuivey, an analyst with Forrester Research.