Even though Nook was theoretically split from Barnes & Noble, it’s still negatively affecting the company’s financial outcome. The fourth quarter earnings came in this week, showing a positive holiday quarter for B&N, but also bad times for the Nook.
Nook revenue dropped by 55% last year, making us wonder if the physical or digital part of Barnes & Noble is failing. Nook’s earnings include digital services, eBooks and accessories, as well as the Samsung Nook. This product was meant to bring back the brand as a whole, in spite of Samsung taking the reins of the hardware part. Nook’s digital content sales dropped 25% compared to the year before, while the device and accessory sales dropped a major 68%.
The separation of digital and physical will go down in August and with the digital not doing so well, it’s clear that the split may not happen in the end. So, in spite of Barnes & Noble being up 1.7% in physical retail, the Nook problems dragged them down to an overall 0.6% decline. It’s an endless circle here: bad hardware sales will be blamed on digital and bad digital sales on hardware sales…
How can they solve the issue, I wonder?