Barnes & Noble chief executive William Lynch resigned on Monday, an acknowledgement that its digital division Nook has failed to compete successfully in the e-reader and tablet markets and possibly presaging a further shake-up in the company.
Chairman and founder Leonard Riggio, the largest shareholder of Barnes & Noble, said the company is reviewing its strategic plan and announced a series of executive changes.
The new appointments suggest Riggio may be stepping up efforts to re-organise the company by separating the Nook business from the chain of hundreds of Barnes & Noble physical stores.
But with Microsoft and Pearson in the wings as minority stakeholders in Nook, it’s not clear how this will be all be resolved, analysts said.
Signs that Barnes & Noble had come to a turning point with Nook came in the latest quarter, when it reported dismal results, led by a 34 per cent drop in Nook sales. It also said it would stop making Nook tablets, marking the end of a costly attempt to compete with Amazon, Apple and Google in the tablet wars.
The operator of the largest chain of bookstores in the United States, has been hit hard by Amazon, which has won market share by selling physical books more cheaply online. Amazon, the world’s largest Internet retailer, inflicted more damage when its Kindle e-reader became a hit and e-book sales took off about five years ago.
Borders, another big bookstore chain, went bust in 2011. But Barnes & Noble survived to challenge Amazon in the e-book market. Lynch took the helm about three years ago and led the development of the Nook e-book store, e-readers and tablets.