Barnes & Noble Education began life under a new management team by reporting that sales in the quarter ended July 31, 2024, slipped 0.3%, to $263.4 million, and its net loss rose to $99.5 million. B&NE attributed the small decline in revenue mainly to the closure of underperforming stores. The company shut 111 outlets in the quarter and opened 30, finishing the period with 1,164 outlets, down from 1,289 a year ago. B&N said it will continue to close underperforming stores while at the same time adding new stores.
The bright spot for B&NE was the continued growth in its First Day programs, B&NE’s name for inclusive access programs that allow students to buy course materials as part of tuition or another fee. In the slow summer quarter before the fall rush season, total First Day sale rose 32%, to $81.4 million, offsetting declines in the al a carte sales of textbooks and other materials. New CEO Jonathan Shar said that B&NE expects “numerous institutions” to begin participating in the company’s First Day programs.
The higher net loss was due in part to a one-time charge of $55.2 million associated with B&NE’s new refinancing package, which was completed in June. The refinancing is intended to give B&NE more funds that it can invest the business, and the company said it has budgeted $20 million for store improvements and technology upgrades.
At the same time, B&NE promised to continue to cut costs, and is in the process of eliminating another $10 million in expenses through such initiatives as streamlining its corporate staff. In a separate initiative, B&NE is working on a stock compensation plan for a “broad range” of employees aimed at promoting “a more ownership-minded culture and better align management and employees with stockholders.”
B&NE did not provide formal financial projections for fiscal 2025, but said management’s “budget goals target a material improvement” in both operating results and adjusted EBITDA. In fiscal 2024, B&NE had a net loss from continuing operations of $62.3 million on sales of $1.57 billion.
