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What: Shares of bookseller Barnes & Noble (NYSE:BKS) jumped as much as 12% today, finishing with 8% gains on reports that sales in its Nook division were growing faster than expected.
So what: The company said sales at its Nook division and college bookstores would grow to $3 billion this fiscal year, which one analyst interpreted as 30% growth from e-books and e-readers. Barnes & Noble also announced that preorders for a new line of Nooks are up 240% from previous launches. The retailer is also planning for its Nook platform to enter nine more foreign markets next year in addition to the United Kingdom, where it will begin selling this year.
Now what: Barnes & Noble continues to lose money both in its Nook division and on its brick-and-mortar stores, so while this news may be heartening for investors, it doesn't likely stem the tide against B&N. The company is competing against heavyweights like Apple and Amazon.com in the tablet wars and the battle for digital content and doesn't seem to have any competitive advantage in that area. Some may argue that its stores offer a brand advantage, but ultimately that unnecessary square footage seems likely to become an albatross against online-only retailers like Amazon.
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