Chain bookseller Barnes & Noble reported a larger than expected loss in the third quarter and reduced its sales and earnings forecast for the holiday season.  B&N announced a loss of $18.4 million for the quarter compared with a profit of $4.4 million in the third quarter of 2007.  Same-store sales dipped 7.4% in Q3 and the company expects them to decline from 6% to 9% in the fourth quarter, which would yield a 5% to 6% decline for the full year.  Barnes & Noble CEO Steven Riggio blamed “a significant drop-off in customer traffic and consumer spending” for the drop in the key indicator of same-store sales.

Barnes & Noble, which expects to have no borrowings by the end of the year, remains in a fairly strong financial position, though the company has taken strong steps to reduce inventory—cutting some $170 million book inventory (compared with last year’s holdings) by means of fairly draconian across-the-board cuts that have even sliced purchases in healthy sectors such as manga and graphic novels (see “Bookstores Feel the Pain”).  In spite of the fact that books can make both satisfying and fairly inexpensive gifts, Barnes & Noble is steeling itself for a relatively slow holiday season, which if it happens, could have far reaching implications across the publishing industry.

B&N’s Riggio blamed the recently concluded presidential campaign for keeping discussion of books at a minimum in newspapers and magazines and in the broadcast media, but this “presidential campaign effect” certainly didn’t have such a drastic effect on book sales in previous election years.  Whatever the reason, it does appear that book sales are down considerably, especially in brick and mortar outlets.  But it’s not just retailers--publishers are also feeling the pressure from slower sales.  Random House has just announced that it is freezing pensions for all current employees and that it will not be offering any sort of pension to future employees.