The Secret's Out, Results Drop at S&S

by Jim Milliot -- Publishers Weekly, 4/29/2008 8:25:00 AM

Faced with difficult comparisons to last year when The Secret led to a blowout first quarter, Simon & Schuster reported this morning that revenue in the first period fell 12%, to $201.6 million, while operating income declined 32%, to $14.6 million. S&S CEO Carolyn Reidy said the company “did what we thought we’d do,” given that in last year’s first quarter S&S shipped $53 million worth of The Secret products. “We made up $15 million of that, but we couldn’t make up the whole thing,” Reidy said. While S&S had a record number of New York Times bestsellers in the quarter, bestsellers are not selling in the quantity they once did, Reidy said. In addition, S&S is beginning to see gains in sales of trade paperback and mass market paperback, something Reidy speculated that could mean consumers are looking for cheaper options to hardcovers. “It’s something we’re watching,” Reidy said.

The Secret remained one of S&S’s top selling titles in the most recent quarter, joined by such newcomers as Duma Key, Change of Heart, Where Are You Now? and Nineteen Minutes plus Howard Press’s first-ever #1 bestseller Mistaken Identity. Children’s sales fell about 2% in the quarter; top sellers included The Spiderwick Chronicles, Tweak and Alphabet. The international segment was up 10%, led by a 20% gain in the U.K., and Reidy repeated comments made at the London Book Fair that her goal is to see the U.K. division triple in revenue in five years.

Reidy was confident S&S will have a strong second half of the year, ticking off a list of possible bestsellers ranging from Phil McGraw to a new green series for children. The biggest late summer title, however, is likely to be Bob Woodward’s next book--the fourth in his Bush at War sereis--which Reidy called “explosive,” and one that “will affect the election.” It's due out in September.