The Future of the Ebook

Barnes and Noble’s Nook Business Just Lost a Whole Lot of Money

So much for the brave new world, huh.
(KAREN BLEIER/AFP/GettyImages)

(KAREN BLEIER/AFP/GettyImages)

Once the great hope for Barnes and Noble, the company’s Nook business is not looking great today. The company just put out its quarterly earnings release, and the numbers are bad enough that Barnes and Noble plans to stop making its own color Nook tablets, switching to “a partnership model for manufacturing.”

According to the earnings release, the company’s Nook unit (which includes devices and digital content, i.e., what’s supposed to be the future) slipped 34 percent for the quarter to $108 million in revenue and 16.8 percent for the year to $776 million.

Those bleak number are due, largely, to poor device sales. (And not particularly surprising, given how the company kept slashing prices.) Digital content sales (so, ebooks) were up 16.2 percent for the year but down 8.9 percent for the fourth quarter. They swear that’s partly because last year’s sales of Hunger Games and Fifty Shades of Grey titles were so enormous, though.

In an attempt to stem the tide, Barnes and Noble will stop making its own Nook color tablets, instead sharing the burden with a T.B.A. third-party manufacturer, co-branding the results. Don’t worry though! “We plan to continue to innovate in the single purpose black-and-white eReader category,” said CEO William Lynch in a statement. No doubt there’s still plenty of money in that particular banana stand.

“The underpinning of our strategy remains the same today as it has since we first entered the digital market, which is to offer customers any digital book, magazine or newspaper, on any device,” he added. Very reassuring.

Hopefully this means books will get a bigger footprint at the front of the store. (Well, for as long as there still are stores, anyway.)

Follow Kelly Faircloth on Twitter or via RSS. kfaircloth@observer.com