Barnes & Noble cuts guidance; chairman cites presidential campaign

The nation’s largest book-seller Thursday lowered its full-year same-store sales forecast amid declining sales caused by the upcoming election.



At least that’s how Barnes & Noble founder and executive chairman Leonard Riggio partially explained the chain’s disappointing first quarter results. Riggio, 75 and the company’s largest shareholder, has been leading Barnes & Noble since August, when it fired CEO, Ronald Boire, who had been in the position for just under a year.



“I believe the current trend can be traced precisely to the current election cycle, which is unprecedented in terms of the fear, anger and frustration being experienced by the public," said Riggio on the chain’s quarterly conference call.



He added that that people’s preoccupation with the election is keeping them at home, "glued to their TVs and at their desktops."



“Retail traffic by any measure and across all segments is close to a historic low point,” Riggio said.



Barnes & Noble reported a loss of $14.4 million, or 20 cents a share, compared with a year-earlier loss of $34.9 million, or 68 cents a share. Excluding expenses related to cost-cutting efforts and other items, the per-share loss from continuing operations was 7 cents.



For the period ended July 30, quarterly revenue fell 6.6%, more than expected, to $913.9 million. Same-store sales declined 6%.



"Given the softer than expected sales results to date, and the expected continuation of the challenging retail environment, the company now expects fiscal 2017 comparable store sales to decline in the low single digits," the retailer said in a statement.



Most of Barnes & Noble’s challenges have nothing to do with the current presidential campaign. The chain has been struggling for some time to compete with Amazon and other online players. Also, its Nook business is on the decline, with sales down 25% in the quarter. And on the call, Riggio noted the company did itself some harm “by making unprecedented inventory reductions, which were ill-advised by cutting expenses in the worst areas, mainly retail floor personnel.



“These conditions are being remedied as we speak, at the same time, we are poised to execute our plan to reduce expenses by attacking areas which are not sale sensitive and we will continue to spend money wisely on initiatives which will build sales in the bottom line,” Riggio said.