UPDATE: Barnes & Noble Shares Drop After Q3 Results

Shares of

dropped more than 2% in pre-market trading after the company reported results for its fiscal third quarter. The New York-based company posted a quarterly profit of $72.2 million, or $0.93 per share, versus a year-ago profit of $63.2 million, or $0.86 per share. Its sales slipped to $1.96 billion from $2 billion. However, analysts were expecting a profit of $1.48 per share on sales of $1.9 billion. Revenue for the Retail segment fell 1% to $1.4 billion for the quarter, while revenue for the College segment climbed 7.2% to $521 million. The NOOK segment's revenue tumbled 50.6% y/y to $78 million for the quarter. Michael P. Huseby, Chief Executive Officer of Barnes & Noble, Inc. said, "Retail Core comparable sales increased 1.7% on the continued stabilization of the physical book business, as well as continued growth in non-book core categories such as Educational Toys & Games and Gifts. While College continues to invest in its future, its top line sales grew through new school acquisitions and better than expected comparable sales trends. NOOK's EBITDA loss was cut in half due to ongoing cost rationalization efforts. This performance across all businesses further supports our belief that now is the right time to separate the College business. The separation will allow each business to optimize their strategic opportunities, given their respective growth profiles, and specifically enable College to pursue opportunities in the growing educational services market." For fiscal year 2015, Barnes & Noble projects retail comparable bookstore sales to drop in the low-single digits, while the company expects retail core comparable bookstore sales to be flat. Barnes & Noble now projects college comparable store sales to be flat. Barnes & Noble shares fell 2.05% to $24.35 in pre-market trading.