Amazon’s Big First Quarter
Amazon’s first quarter saw total revenue rise 34%, to $13.18 billion. While net income fell 35%, to $130 million, earnings easily beat Wall Street expectations. Amazon gave lots of the credit to its digital offerings, saying nine of the top 10 selling products in the quarter were digital, led by the Kindle Fire, the bestselling product in the period. In North America, sales in the electronics and other general merchandise segment (home to Kindle) jumped 44%, to $4.78 billion, while sales of media (home to books and e-books) rose a respectable 16%, to $2.2 billion. The gain in North America media was driven by Kindle Fire owners buying “a lot of content,” Amazon CFO Tom Szkutaz said.
Tor/Forge Drop DRM
In a move likely to be followed by other publishers, Tor/Forge announced plans to drop DRM from all its e-book releases by July 2012. Although used by most large publishers and online retailers, digital rights management software, which is designed to prevent digital copying, is generally considered ineffective at stopping digital piracy as well as being a nuisance to legitimate consumers.
Hedge Fund Takes 11% Stake in B&N
Jana Partners, a hedge fund known for taking an activist role in companies in which it invests, acquired 6.59 million shares of Barnes & Noble, giving the firm an 11.6% stake in the company. Jana has an option to acquire another 250,000 shares. The investment makes Jana the fourth largest stakeholder in B&N, following chairman Len Riggio, Liberty Media, and Ron Burkle.
Disney Leaving White Plains
Just short of five years after it relocated most of its New York City employees to nearby White Plains, N.Y., Disney Publishing Worldwide is again embarking on another move, transferring more than 100 DPW employees to Glendale, Calif., where they will be with Disney Consumer Products and Disney Interactive, and close to Disney headquarters in Burbank. Moving back to New York City will be most of the employees who work for the Disney Book Group. The company expects to complete the transfers by September 30, at which time the White Plains office will be closed.
Mixed Start for McGraw-Hill Education
Revenue at McGraw-Hill Education declined 2%, to $296 million, in the first quarter ended March 31, but the operating loss was cut to $65 million from $75 million in last year’s first period, parent company McGraw-Hill Cos. reported. The drop in revenue was attributed to continued weakness in the school group, where sales fell 10%, partially offset by a 2% revenue gain in the higher education, professional, international group. The improvement in operating loss was due in part to a fourth-quarter restructuring that cut 540 jobs.
Regnery Plans Children’s Imprint
Regnery Publishing will launch a children’s imprint this summer. Little Patriot Press will publish titles for children ages 5–8 that will be aimed at “teaching and inspiring children through stories about American history and government,” according to the company. Regnery will release seven picture books this year, including a series by Peter and Cheryl Barnes that features different mice explaining important moments in history. Diane Reeves is the managing editor for Little Patriot Press, and Cheryl Barnes is serving as creative director.
New BAM CFO
Books-A-Million has appointed R. Todd Noden as chief financial officer, replacing Brian White, who has resigned. Noden, most recently CFO of Dobbs Mills, will report to CEO Terry Finely.