Barnes & Noble Is Still Losing Money, Wants Third Party OEMs To Make Nook TabletsBy: Zach Walton - June 25, 2013
In a report from May, Barnes & Noble said that it would be ditching its own tablet efforts and instead focus on licensing the Nook brand to third parties. In its latest earnings report, the company confirmed that to be the case.
In its fiscal fourth quarter earnings report, Barnes & Noble said that it’s still losing money. The book store only brought in $948 million this quarter after a $118.6 million quarterly net loss. It’s annual revenue also dropped to $6.8 billion after a loss of $154.8 million.
As for Nook, it took a beating last quarter. Nook Media reports that it only brought in $108 million in quarterly revenue.
Despite its poor performance, Nook Media has a plan. It’s going to start offering the Nook brand to third-party OEMs. In other words, you’re going to soon start seeing tablets from Asus, Acer and others that bear the Nook branding. Think Google’s Nexus line, but with Nook branding instead.
The move will allow Nook Media to distance itself from the costly process of manufacturing its Nook HD and Nook HD+ tablets. By offloading the work of making Nook tablets onto others, it can save some money in the long run.
Of course, this doesn’t mean that that Nook will stop making hardware altogether. Nook Media will continue to build its own e-readers as manufacturing costs aren’t as high, and it doesn’t have to compete with hundreds of alternatives. The market for e-readers is pretty stable as well so Nook will be able to make some decent money for a few more years.
All in all, it looks like Barnes & Noble and Nook Media are making some solid decisions for now. The next big fight is just on the horizon, however, as Barnes & Noble founder Leonard Riggio has plans to buy the retail operation of Barnes & Noble and take it private. As for Nook, he wants to completely cut ties. If that happens, moving to exit the hardware business is about the smartest option for the once proud e-reader maker.[h/t: TechCrunch]