Sales for Co-Branded Samsung/Nook Tablets Below Expectations in Early Holiday Report

Despite efforts to entice consumers with $50 and $100 discounts on the 7- and 10-inch Samsung Galaxy Tab 4 Nook tablets before Black Friday, early holiday season sales results “weren’t quite up to our expectations,” said Barnes & Noble CEO Michael Huseby on an earnings call last week. But the companies aren’t pushing “a red alert” button “because we have the whole holiday, Christmas” and “just about” all of December left, Huseby said. Propping up the Nook brand with a Samsung Galaxy tablet at its core didn’t help Barnes & Noble’s troubled Nook segment in fiscal Q2, the first full quarter that the Nook-branded Samsung tablet was available for sale, but the company plans to continue selling the devices, Huseby said. Sales for Nook hardware, content and accessories tumbled 41 percent year over year, the company said. Nook device and accessories sales plummeted 64 percent to $19 million on lower sales volume, while digital content fell 21 percent to $45 million, the company said. The results surprised some analysts who had predicted the Samsung hardware would shore up sales of the struggling Nook brand. Janney Capital Markets had expected the Samsung-built devices to help “spur demand and drive new customer adoption,” but said in a research note that the Nook Galaxy tablets are “not performing as well as originally expected.” On the earnings call, Huseby cited “a lower demand for tablet devices in general” due to market saturation but believes the Nook tablets are priced “right.” Huseby expressed support for Samsung as its partner, calling the Galaxy Tab 4s “great devices” and said Barnes & Noble has no plans to discontinue Galaxy Nook tablet sales. “It's important that we can offer an e-reading experience” in a color tablet, in addition to its GlowLight e-reader, Huseby said. He said Barnes & Noble and Microsoft agreed to end their partnership in Nook Media.