Looks like things at Barnes & Noble will get a bit worse before they have a chance of getting better. The bookseller has just announced that William Lynch has resigned as CEO, effective immediately, as the company commences “reviewing its current strategic plan.” No details yet on what the review will entail: B&N says it “will provide an update when appropriate.”
Lynch is getting replaced, effectively, by Michael P. Huseby, who had been the CFO and now has been appointed Chief Executive Officer of NOOK Media LLC and President of Barnes & Noble, Inc. Meanwhile, Max J. Roberts, Chief Executive Officer of Barnes & Noble College, will continue to lead education, reporting to Huseby. Huseby and Mitchell Klipper, Chief Executive Officer of the Barnes & Noble Retail Group, will report directly to Leonard Riggio, Executive Chairman of Barnes & Noble, Inc.
Given the company’s focus now on simply turning around what they have in front of them, it seems not too surprising that they’ve put a financial man effectively at the helm of the company. (Huseby joined a just over a year ago, and prior to that he had been CFO at pay-TV provider Cablevision.) Still, it points to a company not currently set on being visionary, and instead hunkering down to business.
And it stands as a contrast to 2010, when Lynch took the top position at the company. Coming from leading B&N’s web division, he was seen as a signal of how B&N wanted to jump into a digital future with two feet.
Jump B&N did, but maybe with a bit more belly flop than was intended.
Its NOOK e-readers never managed to beat back competition from the ever-strong Amazon, and the move into NOOK tablets, based on Android, never quite hit the mark, either — a position that only seemed to get worse over time. B&N’s last quarter saw the company report a loss of nearly $119 million, more than double the loss in the quarter a year before. The NOOK division specifically, the thing on which B&N has pinned its future, made only $108 million in revenue in that period, a 34% drop from a year ago. Competition from Amazon and its Kindle products, as well as a host of other e-reader and tablet makers, have weighed down on the company and turned that splash into a thud.
The last quarter’s results signalled something new: B&N used its earnings to announce a drastic change in direction for the NOOK device business, by opening up the brand to tablet OEMs. It’s not the only change the company has made. In May, B&N killed off dedicated Mac and PC Nook apps. Seen as another sign of retrenchment, now moves like these look to be possibly just the first steps in what the company decides to do to try to turn things around.
Where will this ultimately go? Don’t forget that we heard a while back that Microsoft was eyeing up a $1 billion purchase of Nook Media, so a sale to someone, somewhere, could be in the wings. Barnes & Noble owns 78% of the tablet and e-reader division, with Pearson and Microsoft the other shareholders.
Other appointments announced today include Allen Lindstrom, who had been VP and the Company’s Corporate Controller, taking over the CFO role of of Barnes & Noble Inc, and Kanuj Malhotra, VP of Corporate Development, now CFO of NOOK Media LLC.