Barnes & Noble Edu | 8-K: FY2025 Revenue: USD 1.6 B

Revenue: As of FY2025, the actual value is USD 1.6 B.

Gross Profit Adjustments

Fiscal 2024 experienced a $3.1 million decrease in gross profit for the full year, with quarterly adjustments as follows: Q1 saw a $2.4 million decrease, Q2 a $4.5 million increase, Q3 a $0.8 million decrease, and Q4 a $4.4 million decrease.
Fiscal 2025 had a $4.8 million decrease in gross profit for the full year, with Q1 experiencing a $3.1 million decrease, Q2 a $3.8 million increase, Q3 a $1.1 million decrease, and Q4 a $4.4 million decrease.

Lease Accounting Adjustments

The company identified errors in accounting for store operating agreements, specifically regarding minimum annual commission guarantees and timing of expense recognition, which were not in accordance with Accounting Standards Codification Topic 842, Leases.
These adjustments do not impact the total amount of expense recognized, the profitability of individual store operating agreements, or the company’s overall profitability, including Net Income and EBITDA over the term of the contract.

Cash Flow and Debt

The adjustments will not impact the company’s fiscal 2025 year-end cash and cash equivalents or total debt.

FY2025 Preliminary Financial Results

Revenue: Full-year preliminary (unaudited) revenue in fiscal 2025 is expected to be $1.6 billion, an increase of $40.8 million, or 2.6%, over the prior year. Gross Comparable Store Sales are expected to increase by $116.9 million, or 7.5%, year-over-year.
Net Loss: Full-year fiscal 2025 net loss (unaudited) is expected to be in the - $68.0 to - $62.0 million range compared to an expected net loss in the - $78.0 to - $72.0 million range (as restated) in the prior year.
Adjusted EBITDA: Expected to range from $55.0 to $63.0 million, an increase of $15.0 to $29.0 million, from the $34.0 to $40.0 million range in the prior fiscal year (as restated).
Debt: Total debt at year-end is expected to be $103.1 million compared to $196.3 million on April 27, 2024. Total net debt is expected to be $94.0 million, representing a $91.8 million year-over-year decrease.

First Half of FY2026 Preliminary Financial Results

Revenue: Preliminary, unaudited revenue for the first six months of fiscal 2026 is expected to be approximately $933.0 million, an increase of approximately 7.8% year-over-year.
Net Income: Preliminary, unaudited net income for the first half of fiscal 2026 is expected to range from $3.0 to $8.0 million, an anticipated improvement of $62.0 to $73.0 million over net loss of - $65.0 to - $59.0 for the first six months of fiscal 2025 (preliminary, unaudited as restated).
Adjusted EBITDA: Expected to be in the range of $32.0 to $42.0 million as compared to $30.0 to $36.0 million of Adjusted EBITDA in the first six months of fiscal 2025 (preliminary, unaudited, as restated).
Debt: Total Net Debt is expected to be $110.8 million at the end of 2Q Fiscal 2026, a $55.2 million decrease compared to the end of the second fiscal quarter in fiscal 2025.

Outlook

Barnes & Noble Education expects continued top line growth in fiscal 2026 despite one fewer operating week and broader market uncertainties in the higher education and retail sectors. Supported by anticipated gross profit dollar increases and continued expense discipline, the Company currently expects Adjusted EBITDA in the range of $65 to $75 million. Looking ahead to fiscal 2027, the Company sees meaningful opportunities to improve gross margins and is seeking to grow Adjusted EBITDA in the range of 15% to 20% or more.