Barnes & Noble Education Plummets After Q2 Results, Top-Line Lags Consensus

  • Barnes & Noble Education Inc BNED reported second-quarter FY22 sales growth of 5.3% year-on-year, to $626.98 million, missing the analyst consensus of $663.30 million.
  • Retail segment gross comparable store sales increased 13.2%, and retail sales rose 5.6%. Wholesale sales decreased 40.5%.
  • Comparable textbook sales remained essentially flat, compared to a 19% decline a year ago, as enrollment declines were mitigated by the growth of First Day offerings.
  • Gross profit rose 26.3% Y/Y to $145.6 million with a margin of 23.2%. The operating margin was 4%, with the operating income increasing 265% Y/Y to $24.6 million.
  • Adjusted EBITDA of $39 million rose 59.2% from last year. EPS was $0.41 versus $0.15 last year.
  • Barnes & Noble Education held $23.5 million in cash and equivalents as of October 30, 2021.
  • Outlook: Barnes & Noble Education expects to generate positive non-GAAP Adjusted EBITDA in FY22.
  • The company expects non-GAAP adjusted EBITDA to approach annual pre-COVID levels in FY23.
  • Price Action: BNED shares traded lower by 21.2% at $6.98 on the last check Tuesday.
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