Total sales for the third quarter ended October 31 at Barnes &Noble rose 9.6%, to $674.1 million, led by a 10.9% increase, to $554 million, from its superstores. Sales at barnesandnoble.com rose to $17.2 million, an increase of 330% over the comparable period in fiscal 1998, and a 38% increase from the second quarter. Revenues also benefited from a 4.5% gain in comparable store sales at its superstores, as well as the opening of 17 new outlets.
Despite the sales increase, B&N reported an operating loss in the period of just under $1 million, as the operating profit of $19.6 million from its retail operations was offset by a $20.5 million loss at barnesandnoble.com.
B&N hopes that the sale of a 50% stake in the online venture to Bertelsmann, which closed November 12, will stop draining cash from the company. According to B&N, the sole source of new funding for barnesandnoble.com in the future will come from the $200 million paid by Bertelsmann as part of its deal with B&N. B&N said it will use the cash flow from its retail operations to support other strategic initiatives, which presumably include its planned purchase of Ingram Book Group.
In the third quarter, barnesandnoble.com had 930,000 customers in 177 countries, an increase of 29% over the number of customers it had at the close of the second quarter. Sales from repeat customers accounted for 51% of the quarter's sales.
For the first nine months of the year, total sales rose 8.5%, to just under $2 billion, while the company posted an operating loss of $4.1 million, compared to operating income of $20.5 million in the first nine months of fiscal 1998.
