Barnes & Noble to Spin Off Nook Business
The bookseller is splitting its retail and e-book divisions into two separate companies.
Barnes & Noble will split its retail and Nook Media businesses into two separate public companies as it looks to boost shareholder value.
The bookseller's stock jumped more than 7 percent in Wednesday pre-market trading.
The company's retail business includes its bookstores and BN.com businesses. Nook Media, in which Microsoft Corp. is an investor, houses the digital and college businesses of Barnes & Noble.
Barnes & Noble has been trying to turn itself around as competition from discount stores and online retailers toughens, and as readers shift away from traditional books to digital formats.
The company spent years investing heavily in its Nook e-book reader and e-book library, but they struggled to be profitable. In December, Barnes & Noble said it was evaluating the future of its tablets, but it still offered a new non-tablet e-book reader during the holiday season.
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The New York-based chain, which announced earlier this month that it was teaming with Samsung to develop Nook tablets, said that its board has approved the plan. It hopes to complete the separation by the end of the first quarter of 2015.
Barnes & Noble Inc. also reported that its fiscal fourth-quarter loss narrowed to $36.7 million, or 72 cents per share, from a loss of $114.8 million, or $2.04 per share, a year earlier. Revenue for the period ended May 3 edged up to $1.32 billion from $1.28 billion.
Analysts surveyed by FactSet expected a loss of 49 cents per share on revenue of $1.19 billion.
Looking ahead, the company anticipates that fiscal 2015 sales at bookstores and college stores open at least a year will decline in the low single digits.
Shares of Barnes & Noble stock rose $1.50, or 7.3 percent, to $22.06 before the market opened.