Simon & Schuster sales fell 5% in the first quarter ended March 31, 2015 compared to the first quarter of 2014, dropping to $145 million. Operating income, however, increased to $12 million from $11 million, parent company CBS reported.
Sales of digital products were up in the quarter, but sales of print were down. Digital revenues represented 31% of S&S’s total revenues for the first quarter of 2015. S&S CEO Carolyn Reidy said that while sales of e-books rose by one percentage point in the quarter, sales of digital audio had a huge quarter driven by sales of both new and backlist books. She also noted that with the rise in e-book sales in the quarter, e-books accounted for about 26.3% of all revenue, higher than any share the format represented in 2014. And despite the dip in print sales, Reidy said sales through physical stores remained strong in the quarter. She attributed the print decline partly to the mix of titles, noting that in the first quarter of 2014 the company was stil enjoying good sales of Duck Dynasty books.
The sales mix also helped to partially explain the improvement in profits in the quarter. Reidy noted that one of its biggest books in the period was the Pulitzer Prize-winning All the Light We Cannot See which has been in the market since last May.
In addition to All the Light We Cannot See other bestsellers included Get What's Yours: The Secrets to Maxing Out Your Social Security, Leaving Berlin, I've' Got You Under My Skin and Still Alice. S&S has also benefited from the hot start of its Keywords imprint which focuses on publishing books by YouTube and other Internet stars. The imprint has published three titles so far and all have hit the bestsellers list. In addition to sales, Reidy believes that success of the Keywords books is drawing in new readers who, after seeing the personalities on the web want to own something from them. Bookstore signings have draw as many as 4,000 fans, Reidy noted.
Reidy thinks S&S will have a solid second quarter, pointing to such promising titles as The Wright Brothers by David McCullough which is already off to a good start, Stephen King's Finders Keepers, The Melody Lingers On by Mary Higgins Clark, and Jimmy Carter's A Full Life.
Note: This piece has been updated since it was initially posted to include comments from S&S CEO Carolyn Reidy.