Barnes & Noble Inc. (BKS), the leading U.S. bookseller, on Monday said quarterly profit fell due to higher expenses and soft demand for titles in its bestseller category. Even so, the New York-based retailer stood by its previous forecast for consolidated profit of $1.51 to $1.56 per share in the fourth quarter and $1.96 to $2.04 for the full year.
Profit in the third-quarter ended Oct. 30 fell to $7.6 million, or 10 cents a share, from $10.2 million, or 14 cents a share, a year earlier. According to Reuters Research, analysts had forecast a profit of 12 cents a share.
Barnes & Noble Chief Executive Officer Steve Riggio (search) said in a statement higher purchases of DVD media, juvenile products and cafe merchandise helped offset some of the weakness from the bestseller title segment.
Last year, Barnes & Noble had largely benefited from the excitement caused by the publication of a new Harry Potter (search) novel and the memoir of former U.S. first lady Hillary Clinton (search). In addition, books tied to the Iraq war also fueled demand.
For the latest quarter, Barnes & Nobles said its consolidated sales, which include a contribution from its Internet arm, increased to $1.46 billion from $1.27 billion.
At Barnes & Noble bookstores sales rose 4 percent to $894.9 million, while sales at stores open at least a year, or same-store sales, edged up by 0.9 percent.
"We are encouraged that we were able to achieve our sales goal for the third quarter in the light of the challenging sales comparisons from last year," Riggio said in the statement.
According to Reuters Estimates, analysts expect Barnes & Noble to post a fourth-quarter profit of $1.54 a share compared with $1.65 a share last year. For the full-year, the analysts' average estimate is $2.01, compared with $2.07 a share in the prior year.
The company's outlook, which excludes the effects of a debt redemption charge, reflects an end of a profit contribution that Barnes & Noble derived from a 59 percent stake it owned in video game retailer GameStop Corp. (GME), which has now been spun off.
Barnes & Noble's share of GameStop (search) earnings in the third-quarter was $7.2 million, or 10 cents a share, according to Barnes & Noble. It added that Monday was the first day that Barnes & Noble and GameStop will trade only as separate public companies.
Barnes & Noble shares were down 28 cents at $26.05, while GameStop shed 65 cents to $22.85 even after posting a higher quarterly profit on increased gaming hardware sales.