Faced with difficult comparisons to last year’s third quarter, when Bob Woodward’s Fear: Trump in the White House was a huge hit, sales at Simon & Schuster fell 9.6% in the most recent period compared to a year ago. Despite the revenue decline, operating income at the publisher rose by $1 million over the third quarter of 2018, to $52 million, making it the 19th consecutive quarter earnings rose year over year at the publisher. Sales were $217 million, down from $240 million, in the comparable period in 2018.
S&S CEO Carolyn Reidy attributed the earnings increase to lower cost of goods, as well as cost controls and improvements in the supply chain. “It’s something we work hard at,” she said, referring to making the supply chain more efficient.
Print sales were down in the quarter, as solid performances of books such as The Institute by Stephen King and The Book of Gutsy Women by Hillary Rodham Clinton and Chelsea Clinton were not enough to offset the bump in print sales provided by Fear. Reidy said last year’s success with Fear also led to a decline in sales in the international group, where the book had been a big seller in a number of countries. Revenue in the children’s group fell 6% in the quarter, which Reidy said was due to the timing of the release of some key titles. The audio department was the bright spot in the quarter, Reidy said, particularly where sales of digital audiobooks were concerned.
Reidy is hoping for a solid fourth quarter, though she acknowledged that the company, especially the adult group, is facing some tough comparisons as Fear sold throughout the holiday season. She said the big adult title for the holidays is likely to be a new edition of Joy of Cooking, which went on sale today. Reidy had high hopes for a number of children’s titles including Keeper of the Lost Cities: Legacy by Shannon Messenger and Sulwe by Lupita Nyong’o, which has already been a #1 bestseller.
For the first nine months of 2019, profits at S&S were up 4.1% over 2018, to $102 million, despite a 1.3% decline in sales, to $599 million. The third quarter report is the last one that parent company CBS will issue before its merger with Viacom is completed, which is expected to be completed in early December.