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Document and Entity Information
 9 Months Ended
Jan. 31, 2015
 Feb. 28, 2015
Document Information [Line Items]
Document Type 10-Q
Amendment Flag false
Document Period End Date Jan 31, 2015
Document Fiscal Year Focus 2015
Document Fiscal Period Focus Q3
Trading Symbol BKS
Entity Registrant Name BARNES & NOBLE INC
Entity Central Index Key 0000890491
Current Fiscal Year End Date --05-02
Entity Filer Category Large Accelerated Filer
Entity Common Stock, Shares Outstanding 63,894,449
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Consolidated Statements of Operations (USD $)
In Thousands, except Per Share data, unless otherwise specified		 3 Months Ended 9 Months Ended
Jan. 31, 2015
 Jan. 25, 2014
 Jan. 31, 2015
 Jan. 25, 2014
Sales $ 1,961,151 $ 1,995,790 $ 4,885,418 $ 5,059,451
Cost of sales and occupancy 1,333,114 1,392,349 3,414,801 3,625,867
Gross profit 628,037 603,441 1,470,617 1,433,584
Selling and administrative expenses 430,663 430,369 1,175,869 1,193,788
Depreciation and amortization 47,853 54,356 147,585 163,039
Operating profit 149,521 118,716 147,163 76,757
Interest expense, net and amortization of deferred financing fees 3,552 7,761 14,774 22,868
Income before taxes 145,969 110,955 132,389 53,889
Income taxes 73,801 47,725 76,372 64,453
Net income (loss) $ 72,168 $ 63,230 $ 56,017 $ (10,564)
Income (loss) per common share
Basic $ 0.96 $ 0.95 $ 0.58 $ (0.4)
Diluted $ 0.93 $ 0.86 $ 0.58 $ (0.4)
Weighted average common shares outstanding
Basic 61,589 59,033 60,056 58,919
Diluted 73,711 71,033 60,128 58,919
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Consolidated Statements of Comprehensive Income (Loss) (USD $)
In Thousands, unless otherwise specified		 3 Months Ended 9 Months Ended
Jan. 31, 2015
 Jan. 25, 2014
 Jan. 31, 2015
 Jan. 25, 2014
Net income (loss) $ 72,168 $ 63,230 $ 56,017 $ (10,564)
Other comprehensive loss, net of tax:
(Increase) decrease in minimum pension liability (net of deferred tax benefit of $2,208) 3,065 (12,682)
Pension reclassification (see Note 15) 7,271 7,271
Total comprehensive income (loss) $ 82,504 $ 63,230 $ 50,606 $ (10,564)
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Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) (USD $)
In Thousands, unless otherwise specified		 9 Months Ended
Jan. 31, 2015
(Increase) decrease in minimum pension liability, deferred tax benefit $ 2,208
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Consolidated Balance Sheets (USD $)
In Thousands, unless otherwise specified		 Jan. 31, 2015
 May 03, 2014
 Jan. 25, 2014
Current assets:
Cash and cash equivalents $ 326,682 $ 340,171 $ 489,583
Receivables, net 261,763 143,981 296,759
Merchandise inventories, net 1,493,438 1,234,635 1,441,889
Textbook rental inventories 77,989 50,341 74,774
Prepaid expenses and other current assets 61,858 66,580 61,285
Short-term deferred taxes 145,868 144,730 169,966
Total current assets 2,367,598 1,980,438 2,534,256
Property and equipment:
Land and land improvements 2,541 2,541 2,541
Buildings and leasehold improvements 1,217,692 1,224,083 1,239,446
Fixtures and equipment 2,021,054 1,938,555 1,925,899
Property and equipment, gross 3,241,287 3,165,179 3,167,886
Less accumulated depreciation and amortization 2,787,224 2,674,466 2,637,613
Net property and equipment 454,063 490,713 530,273
Goodwill 493,189 493,189 495,496
Intangible assets, net 517,050 528,576 532,761
Other noncurrent assets 44,343 44,533 48,391
Total assets 3,876,243 [1] 3,537,449 4,141,177 [1]
Current liabilities:
Accounts payable 1,080,114 735,112 1,135,535
Accrued liabilities 563,984 502,583 629,145
Gift card liabilities 390,102 356,700 392,244
Short-term note payable 127,250 127,250
Total current liabilities 2,034,200 1,721,645 2,284,174
Long-term deferred taxes 214,297 211,925 256,235
Other long-term liabilities 217,193 366,989 331,305
Series J Preferred Stock; $.001 par value; 5,000 shares authorized; 204, 204 and 204 shares issued, respectively 195,744 194,797 194,482
Preferred Membership Interests in NOOK Media, LLC 383,397 382,954
Shareholders' equity:
Common stock; $.001 par value; 300,000 shares authorized; 97,485, 93,540 and 93,335 shares issued, respectively 97 94 93
Additional paid-in capital 1,924,130 1,395,463 1,390,582
Accumulated other comprehensive loss (17,184) (11,773) (16,692)
Retained earnings 381,190 344,021 385,685
Treasury stock, at cost, 34,580, 34,364 and 34,295 shares, respectively (1,073,424) (1,069,109) (1,067,641)
Total shareholders' equity 1,214,809 658,696 692,027
Commitments and contingencies         
Total liabilities and shareholders' equity $ 3,876,243 $ 3,537,449 $ 4,141,177
[1] Excludes intercompany balances.
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Consolidated Balance Sheets (Parenthetical) (USD $)
 Jan. 31, 2015
 May 03, 2014
 Jan. 25, 2014
Series J Preferred Stock, par value $ 0.001 $ 0.001 $ 0.001
Series J Preferred Stock, shares authorized 5,000,000 5,000,000 5,000,000
Series J Preferred Stock, shares issued 204,000 204,000 204,000
Common stock, par value $ 0.001 $ 0.001 $ 0.001
Common stock, shares authorized 300,000,000 300,000,000 300,000,000
Common stock, shares issued 97,485,000 93,540,000 93,335,000
Treasury stock, shares 34,580,000 34,364,000 34,295,000
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Consolidated Statement of Changes in Shareholders' Equity (USD $)
In Thousands		 Total
 Common Stock
 Additional Paid-In Capital
 Accumulated Other Comprehensive Losses
 Retained Earnings
 Treasury Stock at Cost
Balance at May. 03, 2014 $ 658,696 $ 94 $ 1,395,463 $ (11,773) $ 344,021 $ (1,069,109)
Net income 56,017 56,017
Minimum pension liability, net of tax (12,682) (12,682)
Pension reclassification (see Note 15) 7,271 7,271
Exercise of 66 common stock options 1,017 1,017
Stock options and restricted stock tax benefits 316 316
Stock-based compensation expense 16,723 16,723
Accretive dividend on preferred stockholders and membership interests s (7,024) (7,024)
Accrued/paid dividends for preferred stockholders (11,824) (11,824)
Treasury stock acquired, 216 shares (4,315) (4,315)
Acquisition of preferred membership interest 313,298 3 313,295
Settlement of Microsoft commercial liability 197,316 197,316
Balance at Jan. 31, 2015 $ 1,214,809 $ 97 $ 1,924,130 $ (17,184) $ 381,190 $ (1,073,424)
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Consolidated Statement of Changes in Shareholders' Equity (Parenthetical)
 9 Months Ended
Jan. 31, 2015
Common stock options exercised, shares 66,000
Treasury stock acquired, shares 216,000
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Consolidated Statements of Cash Flows (USD $)
In Thousands, unless otherwise specified		 9 Months Ended
Jan. 31, 2015
 Jan. 25, 2014
Cash flows from operating activities:
Net income (loss) $ 56,017 $ (10,564)
Adjustments to reconcile net income (loss) to net cash flows from operating activities:
Depreciation and amortization (including amortization of deferred financing fees) 151,691 167,302
Stock-based compensation expense 16,723 8,147
Non-cash impairment charge 366 2,801
Deferred taxes (3,755) 63,199
Loss on disposal of property and equipment 1,000 160
Decrease in other long-term liabilities (24,531) (24,938)
Pension reclassification (see Note 15) 7,271
Changes in operating assets and liabilities, net 46,971 243,509
Net cash flows provided by operating activities 251,753 449,616
Cash flows from investing activities:
Purchases of property and equipment (100,773) (96,178)
Net (increase) decrease in other noncurrent assets (3,918) 4,395
Net cash flows used in investing activities (104,691) (91,783)
Cash flows from financing activities:
Net proceeds from Microsoft commercial agreement financing arrangement 57,161 63,547
Proceeds from credit facility 349,400 734,000
Payments on credit facility (349,400) (811,000)
Proceeds from exercise of common stock options 1,017 158
Purchase of treasury stock (4,315) (3,786)
Cash dividends paid to shareholders (12,085) (11,826)
Excess tax benefit from stock-based compensation 1,096 187
Payment of Junior Seller Note (127,250)
Acquisition of Preferred Membership Interests (76,175)
Net cash flows used in financing activities (160,551) (28,720)
Net increase (decrease) in cash and cash equivalents (13,489) 329,113
Cash and cash equivalents at beginning of period 340,171 160,470
Cash and cash equivalents at end of period 326,682 489,583
Changes in operating assets and liabilities, net:
Receivables, net (117,782) (147,390)
Merchandise inventories (258,803) (31,120)
Textbook rental inventories (27,648) (21,023)
Prepaid expenses and other current assets 4,722 1,598
Accounts payable and accrued liabilities 446,482 441,444
Changes in operating assets and liabilities, net 46,971 243,509
Supplemental cash flow information:
Interest 15,040 18,771
Income taxes (net of refunds) 50,079 1,708
Non-cash financing activity:
Accrued dividend on redeemable preferred stock 3,942 3,942
Acquisition of Preferred Membership Interests for 2,737,290 shares of common stock of Barnes & Noble $ (76,175)
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Consolidated Statements of Cash Flows (Parenthetical) (B&N Education, LLC, Common Stock)
 0 Months Ended 9 Months Ended
Dec. 03, 2014
 Jan. 31, 2015
B&N Education, LLC | Common Stock
Acquisition of Preferred Membership Interests, Shares issued 2,737,290 2,737,290
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Basis of Presentation
 9 Months Ended
Jan. 31, 2015
Basis of Presentation

The unaudited consolidated financial statements include the accounts of Barnes & Noble, Inc. and its subsidiaries (collectively, Barnes & Noble or the Company).

In the opinion of the Company’s management, the accompanying unaudited consolidated financial statements of the Company contain all adjustments (consisting of only normal recurring adjustments) necessary to present fairly its consolidated financial position as of January 31, 2015 and the results of its operations for the 13 and 39 weeks and its cash flows for the 39 weeks then ended. These consolidated financial statements are condensed and therefore do not include all of the information and footnotes required by generally accepted accounting principles. The consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the 53 weeks ended May 3, 2014 (fiscal 2014).

Due to the seasonal nature of the business, the results of operations for the 39 weeks ended January 31, 2015 are not indicative of the results expected for the 52 weeks ending May 2, 2015 (fiscal 2015).
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Separation of B&N Education, Inc.
 9 Months Ended
Jan. 31, 2015
Separation of B&N Education, Inc.
  1. Separation of B&N Education, Inc.

On February 26, 2015, Barnes & Noble announced plans for the legal and structural separation of Barnes & Noble Education, Inc. (B&N Education) (formerly known as NOOK Media Inc.) from Barnes & Noble into an independent public company (the Spin-Off).

This Spin-Off is expected to be executed by means of a pro-rata distribution of B&N Education’s common stock to Barnes & Noble’s existing shareholders and is considered to be a non-taxable event for Barnes & Noble and its shareholders.

The distribution of B&N Education’s common stock to Barnes & Noble shareholders is conditioned on, among other things, final approval of the Spin-Off plan by the Barnes & Noble Board of Directors; the receipt of opinions from external legal counsel and KPMG LLP to Barnes & Noble, confirming the tax-free status of the Spin-Off for U.S. federal income tax purposes; and the United States Securities and Exchange Commission (SEC) declaring effective the Registration Statement, which was filed on a Form S-1 with the SEC on February 26, 2015.
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History of B&N Education, Inc.
 9 Months Ended
Jan. 31, 2015
History of B&N Education, Inc.
  2. History of B&N Education, Inc.

On September 30, 2009, Barnes & Noble acquired Barnes & Noble College Booksellers, LLC (B&N College) from Leonard and Louise Riggio. From that date until October 4, 2012, B&N College was wholly owned by Barnes & Noble Booksellers, Inc. B&N Education was initially incorporated under the name NOOK Media Inc. in July 2012 to hold Barnes & Noble’s B&N College and NOOK digital businesses. On October 4, 2012, Microsoft Corporation (Microsoft) acquired a 17.6% non-controlling preferred membership interest in B&N Education’s subsidiary B&N Education, LLC (formerly NOOK Media LLC) (the LLC), and through B&N Education, Barnes & Noble maintained an 82.4% controlling interest of the B&N College and NOOK digital businesses.

On January 22, 2013, Pearson Education, Inc. (Pearson) acquired a 5% non-controlling preferred membership interest in the LLC, entered into a commercial agreement with the LLC relating to the B&N College business and received warrants to purchase an additional preferred membership interest in the LLC.

On December 4, 2014, B&N Education re-acquired Microsoft’s interest in the LLC in exchange for cash and common stock of Barnes & Noble and the Microsoft commercial agreement was terminated effective as of such date. On December 22, 2014, B&N Education also re-acquired Pearson’s interest in the LLC and certain related warrants previously issued to Pearson. In connection with these transactions, Barnes & Noble entered into contingent payment agreements with Microsoft and Pearson providing for additional payments upon the occurrence of certain events, including upon a sale of the NOOK digital business. As a result of these transactions, Barnes & Noble owns, and will own prior to the Spin-Off, 100% of B&N Education.

Prior to the Spin-Off, B&N Education will distribute to Barnes & Noble all of the membership interests in B&N Education’s NOOK digital business. As a result, B&N Education will cease to own any interest in the NOOK digital business, which will remain a wholly owned subsidiary of Barnes & Noble.
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Merchandise Inventories
 9 Months Ended
Jan. 31, 2015
Merchandise Inventories
  3. Merchandise Inventories

Merchandise inventories, which primarily consist of finished goods, are stated at the lower of cost or market, where cost is determined primarily by the retail inventory method under both the first-in, first-out (FIFO) basis and the last-in, first-out (LIFO) basis. B&N College’s textbook and trade book inventories are valued using the LIFO method, where the related reserve was not material to the recorded amount of the Company’s inventories or results of operations at January 31, 2015. NOOK merchandise inventories are recorded based on the average cost method.

Market is determined based on the estimated net realizable value, which is generally the selling price. Reserves for non-returnable inventory are primarily based on the Company’s history of liquidating non-returnable inventory.

The Company also estimates and accrues shortage for the period between the last physical count of inventory and the balance sheet date. Shortage rates are estimated and accrued based on historical rates and can be affected by changes in merchandise mix and changes in actual shortage trends.
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Revenue Recognition
 9 Months Ended
Jan. 31, 2015
Revenue Recognition
  4. Revenue Recognition

Revenue from sales of the Company’s products is recognized at the time of sale or shipment, other than those with multiple elements and Free On Board (FOB) destination point shipping terms. Certain of the Company sales agreements with its distribution partners contain rights of inspection or acceptance provisions as is standard in the Company’s industry. The Company accrues for estimated sales returns in the period in which the related revenue is recognized based on historical experience and industry standards. ECommerce revenue from sales of products ordered through the Company’s websites is recognized upon delivery and receipt of the shipment by its customers. Sales taxes collected from retail customers are excluded from reported revenues. All of the Company’s sales are recognized as revenue on a “net” basis, including sales in connection with any periodic promotions offered to customers. The Company does not treat any promotional offers as expenses.

In accordance with Accounting Standards Codification (ASC) No. 605-25, Revenue Recognition, Multiple Element Arrangements and Accounting Standards Updates (ASU) 2009-13 and 2009-14, for multiple-element arrangements that involve tangible products that contain software that is essential to the tangible product’s functionality, undelivered software elements that relate to the tangible product’s essential software and other separable elements, the Company allocates revenue to all deliverables using the relative selling-price method. Under this method, revenue is allocated at the time of sale to all deliverables based on their relative selling price using a specific hierarchy. The hierarchy is as follows: vendor-specific objective evidence, third-party evidence of selling price, or best estimate of selling price. NOOK® device revenue is recognized at the segment point of sale.

The Company includes post-service customer support (PCS) in the form of software updates and potential increased functionality on a when-and-if-available basis, as well as wireless access and wireless connectivity with the purchase of a NOOK® from the Company. Using the relative selling price described above, the Company allocates revenue based on the best estimate of selling price for the deliverables as no vendor-specific objective evidence or third-party evidence exists for any of the elements. Revenue allocated to NOOK® and the software essential to its functionality is recognized at the time of sale, provided all other conditions for revenue recognition are met. Revenue allocated to the PCS and the wireless access is deferred and recognized on a straight-line basis over the 2-year estimated life of a NOOK®.

The average percentage of a NOOK®’s sales price that is deferred for undelivered items and recognized over its 2-year estimated life ranges between 0% and 4%, depending on the type of device sold. The amount of NOOK®-related deferred revenue as of January 31, 2015, January 25, 2014 and May 3, 2014 was $3,613, $13,348 and $9,934, respectively. These amounts are classified on the Company’s balance sheet in accrued liabilities for the portion that is subject to deferral for one year or less and other long-term liabilities for the portion that is subject to deferral for more than one year.

The Company also pays certain vendors who distribute NOOK® a commission on the content sales sold through that device. The Company accounts for these transactions as a reduction in the sales price of the NOOK® based on historical trends of content sales and a liability is established for the estimated commission expected to be paid over the life of the product. The Company recognizes revenue of the content at the point of sale of the content. The Company records revenue from sales of digital content, sales of third-party extended warranties, service contracts and other products, for which the Company is not obligated to perform, and for which the Company does not meet the criteria for gross revenue recognition under ASC 605-45-45, Reporting Revenue Gross as a Principal versus Net as an Agent, on a net basis. All other revenue is recognized on a gross basis.

The Company rents both physical and digital textbooks. Revenue from the rental of physical textbooks is deferred and recognized over the rental period commencing at point of sale. Revenue from the rental of digital textbooks is recognized at time of sale. A software feature is imbedded within the content of our digital textbooks, such that upon expiration of the rental term the customer is no longer able to access the content. While the digital rental allows the customer to access digital content for a fixed period of time, once the digital content is delivered to the customer our obligation is complete. The Company offers a buyout option to allow the purchase of a rented book at the end of the semester. The Company records the buyout purchase when the customer exercises and pays the buyout option price. In these instances, the Company would accelerate any remaining deferred rental revenue at the point of sale.

NOOK acquires the rights to distribute digital content from publishers and distributes the content on barnesandnoble.com, NOOK® devices and other eBookstore platforms. Certain digital content is distributed under an agency pricing model in which the publishers set prices for eBooks and NOOK receives a commission on content sold through the eBookstore. The majority of the Company’s eBook sales are sold under the agency model.

The Barnes & Noble Member Program offers members greater discounts and other benefits for products and services, as well as exclusive offers and promotions via e-mail or direct mail generally for an annual fee of $25.00, which is non-refundable after the first 30 days. Revenue is recognized over the twelve-month period based upon historical spending patterns for Barnes & Noble Members.

In May 2014, the Financial Accounting Standards Board (FASB) issued ASU No. 2014-09, Revenue from Contracts with Customers (ASU 2014-09). The standard provides companies with a single model for use in accounting for revenue arising from contracts with customers and supersedes current revenue recognition guidance, including industry-specific revenue guidance. The core principle of the model is to recognize revenue when control of the goods or services transfers to the customer, as opposed to recognizing revenue when the risks and rewards transfer to the customer under the existing revenue guidance. ASU 2014-09 is effective for annual reporting periods beginning after December 15, 2016. Early adoption is not permitted. The guidance permits companies to either apply the requirements retrospectively to all prior periods presented, or apply the requirements in the year of adoption, through a cumulative adjustment. The Company has not yet selected a transition method nor has it determined the impact of adoption on its consolidated financial statements.
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Research and Development Costs for Software Products
 9 Months Ended
Jan. 31, 2015
Research and Development Costs for Software Products
  5. Research and Development Costs for Software Products

The Company follows the guidance in ASC 985-20, Cost of Software to Be Sold, Leased or Marketed, regarding software development costs to be sold, leased, or otherwise marketed. Capitalization of software development costs begins upon the establishment of technological feasibility and is discontinued when the product is available for sale. A certain amount of judgment and estimation is required to assess when technological feasibility is established, as well as the ongoing assessment of the recoverability of capitalized costs. The Company’s products reach technological feasibility shortly before the products are available for sale and therefore, research and development costs are generally expensed as incurred.
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Net Earnings (Loss) per Share
 9 Months Ended
Jan. 31, 2015
Net Earnings (Loss) per Share
  6. Net Earnings (Loss) per Share

In accordance with ASC 260-10-45, Share-Based Payment Arrangements and Participating Securities and the Two-Class Method, the Company’s unvested restricted shares, unvested restricted stock units and shares issuable under the Company’s deferred compensation plan are considered participating securities. During periods of net income, the calculation of earnings per share for common stock are reclassified to exclude the income attributable to the unvested restricted shares, unvested restricted stock units and shares issuable under the Company’s deferred compensation plan from the numerator and exclude the dilutive impact of those shares from the denominator. Diluted earnings per share for the 13 and 39 weeks ended January 31, 2015 and for the 13 weeks ended January 25, 2014 were calculated using the two-class method for stock options, restricted stock and restricted stock units, and the if-converted method for the preferred stock.

During periods of net loss, no effect is given to the participating securities because they do not share in the losses of the Company. Due to the net loss during the 39 weeks ended January 25, 2014, participating securities in the amount of 2,748,293 were excluded from the calculation of loss per share using the two-class method because the effect would be antidilutive. The Company’s outstanding dilutive stock options of 40,491 and accretion/payments of dividends on preferred shares were also excluded from the calculation of loss per share using the two-class method because the effect would be antidilutive.

 

The following is a reconciliation of the Company’s basic and diluted income (loss) per share calculation:

 

     13 weeks ended      39 weeks ended  
     January 31,
2015		      January 25,
2014		      January 31,
2015		      January 25,
2014		  

Numerator for basic income (loss) per share:

            

Net income (loss) attributable to Barnes & Noble, Inc.

    $ 72,168         63,230       $ 56,017         (10,564 ) 

Preferred stock dividends

      (3,942 )       (3,942 )       (11,825 )       (11,825 ) 

Accretion of dividends on preferred stock

      (5,507 )       (316 )       (7,024 )       (947 ) 

Less allocation of earnings and dividends to participating securities

      (3,380 )       (2,604 )       (2,171 )       —    
  

 

 

     

 

 

     

 

 

     

 

 

  

Net income (loss) available to common shareholders

 $ 59,339      56,368    $ 34,997      (23,336 ) 
  

 

 

     

 

 

     

 

 

     

 

 

  

Numerator for diluted income (loss) per share:

Net income (loss) available to common shareholders

 $ 59,339      56,368    $ 34,997      (23,336 ) 

Preferred stock dividends (a)

   3,942      3,942      —       —    

Accretion of dividends on preferred stock (a)(b)

   5,507      316      —       —    

Allocation of earnings and dividends to participating securities

   3,380      2,604      2,171     —    

Less diluted allocation of earnings and dividends to participating securities

   (3,278 )    (2,338 )    (2,168 )    —    
  

 

 

     

 

 

     

 

 

     

 

 

  

Net income (loss) available to common shareholders

 $ 68,890      60,892    $ 35,000      (23,336 ) 

Denominator for basic income (loss) per share:

Basic weighted average common shares

   61,589      59,033      60,056      58,919   

Denominator for diluted income (loss) per share:

Basic weighted average common shares

   61,589      59,033      60,056      58,919   

Preferred shares (a)

   12,000      12,000      —       —    

Average dilutive options

   122      —       72     —    
  

 

 

     

 

 

     

 

 

     

 

 

  

Diluted weighted average common shares

   73,711      71,033      60,128      58,919   

Income (loss) per common share:

Basic

 $ 0.96      0.95    $ 0.58      (0.40 ) 

Diluted

 $ 0.93      0.86    $ 0.58      (0.40 ) 

 

(a) Although the Company was in a net income position during the 39 weeks ended January 31, 2015, the dilutive effect of the Company’s convertible preferred shares were excluded from the calculation of income per share using the two-class method because the effect would be antidilutive.
(b) Includes accretion of dividends on the preferred membership interests, of which $4,897 was accelerated during the 13 weeks ended January 31, 2015 in connection with the re-acquired preferred membership interests.
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Segment Reporting
 9 Months Ended
Jan. 31, 2015
Segment Reporting
7. Segment Reporting

The Company’s three operating segments are: B&N Retail, B&N College and NOOK.

B&N Retail

This segment includes 649 bookstores as of January 31, 2015, primarily under the Barnes & Noble Booksellers trade name. These Barnes & Noble stores generally offer a dedicated NOOK® area, a comprehensive trade book title base, a café, and departments dedicated to Juvenile, Toys & Games, DVDs, Music, Gift, Magazine and Bargain products. The stores also offer a calendar of ongoing events, including author appearances and children’s activities. The B&N Retail segment also includes the Company’s eCommerce website, barnesandnoble.com, and its publishing operation, Sterling Publishing.

 

B&N College

This segment includes 717 stores as of January 31, 2015 that are primarily school-owned stores operated under contracts by B&N College and include sales of digital content within the higher education marketplace through Yuzu™. These B&N College stores generally offer course-related materials, which include new and used print textbooks and digital textbooks, which are available for sale or rent, emblematic apparel and gifts, trade books, computer products, NOOK® products and related accessories, school and dorm supplies, convenience and café items and graduation products.

NOOK

This segment includes the Company’s digital business, including the development and support of the Company’s NOOK® product offerings. The digital business includes digital content such as eBooks, digital newsstand, apps and sales of NOOK® devices and accessories to B&N Retail, B&N College and third-party distribution partners.

Summarized financial information concerning the Company’s reportable segments is presented below:

 

Sales by Segment    13 weeks ended     39 weeks ended  
     January 31,
2015		     January 25,
2014		     January 31,
2015		     January 25,
2014		  

B&N Retail

    $ 1,395,917      $ 1,410,308      $ 3,238,883      $ 3,339,533   

B&N College

      521,019        486,221        1,498,389        1,449,776   

NOOK

      77,509           156,866           211,402           418,736      

Elimination

      (33,294 )      (57,605 )      (63,256 )      (148,594 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Total

 $ 1,961,151    $ 1,995,790    $ 4,885,418    $ 5,059,451   
  

 

 

    

 

 

    

 

 

    

 

 

  

 

Sales by Product Line    13 weeks ended     39 weeks ended  
     January 31,
2015		     January 25,
2014		     January 31,
2015		     January 25,
2014		  

Media (a)

      69 %      67 %      70 %      68 % 

Digital (b)

      5 %      9 %      5 %      9 % 

Other (c)

      26 %      24 %      25 %      23 % 
  

 

 

    

 

 

    

 

 

    

 

 

  

Total

              100 %               100 %               100 %               100 % 
  

 

 

    

 

 

    

 

 

    

 

 

  

 

Depreciation and Amortization    13 weeks ended     39 weeks ended  
     January 31,
2015		     January 25,
2014		     January 31,
2015		     January 25,
2014		  

B&N Retail

    $ 25,581      $ 31,975      $ 79,953      $ 96,193   

B&N College

      12,582        11,895        37,635        35,271   

NOOK

      9,690           10,486           29,997           31,575      
  

 

 

    

 

 

    

 

 

    

 

 

  

Total

 $     47,853    $     54,356    $   147,585    $   163,039   
  

 

 

    

 

 

    

 

 

    

 

 

  

 

Operating Profit (Loss)    13 weeks ended     39 weeks ended  
     January 31,
2015		     January 25,
2014		     January 31,
2015		     January 25,
2014		  

B&N Retail

    $ 173,010      $ 167,639      $ 210,127      $   204,757   

B&N College

      15,527           23,354           38,549           65,200      

NOOK

      (39,016 )      (72,277 )      (101,513 )      (193,200 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Total

 $   149,521    $   118,716    $   147,163    $ 76,757   
  

 

 

    

 

 

    

 

 

    

 

 

  

 

Capital Expenditures    13 weeks ended     39 weeks ended  
     January 31,
2015		     January 25,
2014		     January 31,
2015		     January 25,
2014		  

B&N Retail

    $ 13,013      $ 11,319      $ 48,297      $ 45,699   

B&N College

      10,501           7,285           35,106           28,359      

NOOK

      4,455        7,437        17,370        22,120   
  

 

 

    

 

 

    

 

 

    

 

 

  

Total

 $     27,969    $     26,041    $   100,773    $     96,178   
  

 

 

    

 

 

    

 

 

    

 

 

  

 

Total Assets (d)    January 31,
2015		      January 25,
2014		  

B&N Retail

    $ 2,191,225       $ 2,279,609   

B&N College

      1,536,723         1,526,698   

NOOK

      148,295         334,870   
  

 

 

     

 

 

  

Total

 $ 3,876,243    $ 4,141,177   
  

 

 

     

 

 

  

 

(a) Includes tangible books, music, movies, rentals and newsstand.
(b) Includes NOOK, related accessories, eContent and warranties.
(c) Includes Toys & Games, café products, college apparel, gifts and miscellaneous other.
(d) Excludes intercompany balances.

A reconciliation of operating income from reportable segments to income from continuing operations before taxes in the consolidated financial statements is as follows:

 

     13 weeks ended      39 weeks ended  
     January 31,
2015		      January 25,
2014		      January 31,
2015		      January 25,
2014		  

Reportable segments operating profit

    $ 149,521       $ 118,716       $ 147,163       $ 76,757   

Interest expense, net and amortization of deferred financing costs

      3,552         7,761         14,774         22,868   
  

 

 

     

 

 

     

 

 

     

 

 

  

Consolidated income before taxes

 $ 145,969    $ 110,955    $ 132,389    $ 53,889   
  

 

 

     

 

 

     

 

 

     

 

 

  

 
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Intangible Assets and Goodwill
 9 Months Ended
Jan. 31, 2015
Intangible Assets and Goodwill
  8. Intangible Assets and Goodwill

 

          As of January 31, 2015  

Amortizable Intangible Assets:

    Useful
Life		    Gross Carrying
Amount		      Accumulated
Amortization		      Total  

Customer relationships

    4-25    $ 271,938       $ (71,337 )     $ 200,601   

Technology

    4-10      10,710         (8,402 )       2,308   

Distribution contracts

    10      8,325         (7,534 )       791   

Other

    2-10      6,419         (6,203 )       216   
     

 

 

     

 

 

     

 

 

  
$ 297,392    $ (93,476 )  $ 203,916   
     

 

 

     

 

 

     

 

 

  

 

Unamortizable Intangible Assets:

       

Trade name

    $ 293,400   

Publishing contracts

      19,734   
  

 

 

  
$ 313,134   
  

 

 

  

Total amortizable and unamortizable intangible assets

 $ 517,050   
  

 

 

  

 

All amortizable intangible assets are being amortized over their useful life on a straight-line basis, with the exception of certain items such as customer relationships and other acquired intangible assets, which are amortized on an accelerated basis.

 

Aggregate Amortization Expense:

       

For the 39 weeks ended January 31, 2015

    $ 11,527   

For the 39 weeks ended January 25, 2014

    $ 13,584   

 

Estimated Amortization Expense:

       

(12 months ending on or about April 30)

   

2015

    $ 14,713   

2016

    $ 11,227   

2017

    $ 10,957   

2018

    $ 10,732   

2019

    $ 10,520   

The carrying amount of goodwill by segment as of January 31, 2015 is as follows:

 

     B&N Retail
Segment		      B&N College
Segment		      Total
Company		  

Balance as of January 31, 2015

    $ 219,119         274,070       $ 493,189   
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Gift Cards
 9 Months Ended
Jan. 31, 2015
Gift Cards
  9. Gift Cards

The Company sells gift cards, which can be used in its stores, on barnesandnoble.com and on NOOK® devices. The Company does not charge administrative or dormancy fees on gift cards and gift cards have no expiration dates. Upon the purchase of a gift card, a liability is established for its cash value. Revenue associated with gift cards is deferred until redemption of the gift card. Over time, a portion of the gift cards issued is typically not redeemed. The Company estimates the portion of the gift card liability for which the likelihood of redemption is remote based upon the Company’s historical redemption patterns. The Company records this amount in income on a straight-line basis over a 12-month period beginning in the 13th month after the month the gift card was originally sold. The Company does not believe there is a reasonable likelihood that there will be a material change in the estimates or assumptions used to recognize revenue associated with gift cards. The Company recorded an additional $4.3 million of gift card breakage during the 13 weeks ended January 31, 2015 as redemptions continued to run lower than historical patterns. Additional breakage may be required if gift card redemptions continue to run lower than historical patterns.

The Company recognized gift card breakage of $10,126 and $5,831 during the 13 weeks ended January 31, 2015 and January 25, 2014, respectively, and $21,259 and $17,503 during the 39 weeks ended January 31, 2015 and January 25, 2014, respectively. The Company had gift card liabilities of $390,102 and $392,244 as of January 31, 2015 and January 25, 2014, respectively.
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Other Long-Term Liabilities
 9 Months Ended
Jan. 31, 2015
Other Long-Term Liabilities
10. Other Long-Term Liabilities

Other long-term liabilities consist primarily of deferred rent, the Microsoft Commercial Agreement financing transaction (see Note 16) and tax liabilities and reserves. The Company provides for minimum rent expense over the lease terms (including the build-out period) on a straight-line basis. The excess of such rent expense over actual lease payments (net of tenant allowances) is classified as deferred rent. Other long-term liabilities also include store closing expenses and long-term deferred revenues. The Company had the following long-term liabilities at January 31, 2015, January 25, 2014 and May 3, 2014:

 

     January 31,
2015		      January 25,
2014		      May 3,
2014		  

Deferred rent

    $ 99,028       $ 132,620       $ 128,280   

Microsoft Commercial Agreement financing transaction (see Note 16)

      —           119,467         140,714   

Tax liabilities and reserves

      72,133         40,814         51,399   

Pension liability (see Note 15)

      16,652         19,048         11,154   

Other

      29,380         19,356         35,442   
  

 

 

     

 

 

     

 

 

  

Total long-term liabilities

 $ 217,193    $ 331,305    $ 366,989   
  

 

 

     

 

 

     

 

 

  

 
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Income Taxes
 9 Months Ended
Jan. 31, 2015
Income Taxes
11. Income Taxes

The Company recorded an income tax provision of $73,801 on a pre-tax income of $145,969 during the 13 weeks ended January 31, 2015, which represented an effective income tax rate of 50.6%. The Company recorded an income tax provision of $47,725 on pre-tax income of $110,955 during the 13 weeks ended January 25, 2014, which represented an effective income tax rate of 43.0%.

The Company recorded an income tax provision of $76,372 on a pre-tax income of $132,389 during the 39 weeks ended January 31, 2015, which represented an effective income tax rate of 57.7%. The Company recorded an income tax provision of $64,453 on pre-tax income of $53,889 during the 39 weeks ended January 25, 2014, which represented an effective income tax rate of 119.6%.

The income tax provisions for the 13 and 39 weeks ended January 31, 2015 include the impact of the allocation to a joint venture partner of operating losses of approximately $63,042 and $105,542, respectively, for income tax purposes. The impact of these allocations has been partly offset by the release of valuation allowances as a result of expected utilization of associated deferred tax assets since, notwithstanding that the Company is in a cumulative three-year loss position as of the end of the prior fiscal year, the Company’s year-to-date taxable income will permit the utilization of these loss and credit carryforwards. Generally, the income tax provision is principally comprised of the result of the activities of profitable jurisdictions at January 31, 2015. For certain jurisdictions, the Company maintains a valuation allowance of approximately $5,972 against specific deferred tax assets utilizable in those jurisdictions.
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Fair Values of Financial Instruments
 9 Months Ended
Jan. 31, 2015
Fair Values of Financial Instruments
  12. Fair Values of Financial Instruments

In accordance with ASC 820, Fair Value Measurements and Disclosures, the fair value of an asset is considered to be the price at which the asset could be sold in an orderly transaction between unrelated, knowledgeable and willing parties. A liability’s fair value is defined as the amount that would be paid to transfer the liability to a new obligor, not the amount that would be paid to settle the liability with the creditor. Assets and liabilities recorded at fair value are measured using a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include:

 

Level 1 – Observable inputs that reflect quoted prices in active markets
Level 2 – Inputs other than quoted prices in active markets that are either directly or indirectly observable
Level 3 – Unobservable inputs in which little or no market data exists, therefore requiring the Company to develop its own assumptions

The Company’s financial instruments include cash, receivables, gift cards, accrued liabilities and accounts payable. The fair values of cash, receivables, accrued liabilities and accounts payable approximate carrying values because of the short-term nature of these instruments. The Company believes that its credit facility approximates fair value since interest rates are adjusted to reflect current rates.
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Credit Facility
 9 Months Ended
Jan. 31, 2015
Credit Facility
  13. Credit Facility

The Company is party to an amended and restated credit facility with Bank of America, N.A., as administrative agent, collateral agent and swing line lender, and other lenders, dated as of April 29, 2011 (as amended and modified to date, the Credit Facility), consisting of up to $1,000,000 in aggregate commitments under a five-year asset-backed revolving credit facility expiring on April 29, 2016, which is secured by eligible inventory and accounts receivable with the ability to include eligible real estate and related assets. Borrowings under the Credit Facility are limited to a specified percentage of eligible inventories and accounts receivable and accrued interest, at the election of the Company, at Base Rate or LIBO Rate, plus, in each case, an Applicable Margin (each term as defined in the Credit Facility). In addition, the Company has the option to request an increase in commitments under the Credit Facility by up to $300,000, subject to certain restrictions.

The Credit Facility requires Availability (as defined in the Credit Facility) to be greater than the greater of (i) 10% of the Loan Cap (as defined in the Credit Facility) and (ii) $50,000. In addition, the Credit Facility contains covenants that limit, among other things, the Company’s ability to incur indebtedness, create liens, make investments, make restricted payments, merge or acquire assets, and contains default provisions that are typical for this type of financing, among other things. Proceeds from the Credit Facility are used for general corporate purposes, including seasonal working capital needs.

The Company had no outstanding debt under the Credit Facility as of January 31, 2015 and January 25, 2014. The Company had $67,264 of outstanding letters of credit under its Credit Facility as of January 31, 2015 compared with $34,363 as of January 25, 2014.
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Stock-Based Compensation
 9 Months Ended
Jan. 31, 2015
Stock-Based Compensation
  14. Stock-Based Compensation

For the 13 and 39 weeks ended January 31, 2015 and January 25, 2014, the Company recognized stock-based compensation expense in selling and administrative expenses as follows:

 

     13 weeks ended      39 weeks ended  
     January 31,
2015		      January 25,
2014		      January 31,
2015		      January 25,
2014		  

Restricted Stock Expense

    $ 248         390       $ 799         1,683   

Restricted Stock Units Expense

      2,990         1,694         13,594         7,688   

Stock Option Expense

      214         382         2,330         (1,224 ) 
  

 

 

     

 

 

     

 

 

     

 

 

  

Stock-Based Compensation Expense

 $ 3,452      2,466    $ 16,723      8,147   
  

 

 

     

 

 

     

 

 

     

 

 

  
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Pension and Other Postretirement Benefit Plans
 9 Months Ended
Jan. 31, 2015
Pension and Other Postretirement Benefit Plans
15. Pension and Other Postretirement Benefit Plans

As of December 31, 1999, substantially all employees of the Company were covered under a noncontributory defined benefit pension plan (the Pension Plan). As of January 1, 2000, the Pension Plan was amended so that employees no longer earn benefits for subsequent service. Effective December 31, 2004, the Barnes & Noble.com Employees’ Retirement Plan (the B&N.com Retirement Plan) was merged with the Pension Plan. Substantially all employees of Barnes & Noble.com were covered under the B&N.com Retirement Plan. As of July 1, 2000, the B&N.com Retirement Plan was amended so that employees no longer earn benefits for subsequent service. Subsequent service continues to be the basis for vesting of benefits not yet vested at December 31, 1999 and June 30, 2000 for the Pension Plan and the B&N.com Retirement Plan, respectively.

        On June 18, 2014, the Company’s Board of Directors approved a resolution to terminate the Pension Plan. The Pension Plan termination was effective November 1, 2014. As a result of the Pension Plan termination, pension liability and other comprehensive loss increased by $15,747, before tax, during the 13 weeks ended August 2, 2014. It is expected to take 18 to 24 months to complete the termination from the date of the approved resolution to terminate the Pension Plan. The pension liability will be settled in either a lump sum payment or a purchased annuity. A special lump sum opportunity was offered to terminated vested participants in the Pension Plan during the 13 weeks ended November 1, 2014, which triggered settlement accounting in the period ending January 31, 2015. The settlement represents 735 participants who elected to receive a lump sum of their benefit, totaling $15,190. The distributions primarily took place in December 2014 and resulted in a settlement charge of $7,271, which was reclassified from other comprehensive income to selling and administrative expenses during the 13 weeks ending January 31, 2015. The net impact of the Pension Plan termination, special lump sum opportunity, settlement accounting and remeasurement and regular plan experience, was an increase in pension liability of $5,498 and a decrease in other comprehensive income of $7,619, before tax, during the 39 weeks ended January 31, 2015. There will be another lump sum opportunity available to the remaining 2,300 active and terminated vested participants at the final Pension Plan termination distribution date. Currently, there is not enough information available to determine the ultimate charge of the termination. The actuarial assumptions used to calculate pension costs are typically reviewed annually. In light of the resolution to terminate the Pension Plan, the assumptions used to calculate the pension costs were reviewed during the 13 weeks ended August 2, 2014. In addition, due to the required settlement, the assumptions were again reviewed during the 13 weeks ended January 31, 2015. Pension expense was $7,914 and $582 for the 13 weeks ended January 31, 2015 and January 25, 2014, respectively, and $9,299 and $1,913 for the 39 weeks ended January 31, 2015 and January 25, 2014, respectively.

 

The Company maintains a defined contribution plan (the Savings Plan) for the benefit of substantially all employees. Total Company contributions charged to employee benefit expenses for the Savings Plan were $3,574 and $3,848 for the 13 weeks ended January 31, 2015 and January 25, 2014, respectively, and $12,049 and $12,384 for the 39 weeks ended January 31, 2015 and January 25, 2014, respectively. In addition, the Company provides certain health care and life insurance benefits (the Postretirement Plan) to certain retired employees, limited to those receiving benefits or retired as of April 1, 1993. Total Company contributions charged to employee benefit expenses for the Postretirement Plan were $38 and $38 for the 13 weeks ended January 31, 2015 and January 25, 2014, respectively, and $113 and $113 for the 39 weeks ended January 31, 2015 and January 25, 2014, respectively.
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Microsoft Investment
 9 Months Ended
Jan. 31, 2015
Microsoft Investment
16. Microsoft Investment

On April 27, 2012, Barnes & Noble entered into an investment agreement pursuant to which Barnes & Noble transferred to the LLC its digital device, digital content and college bookstore businesses, and Morrison Investment Holdings, Inc. (Morrison) purchased from the LLC, 300,000 convertible preferred membership interests in the LLC (Series A Preferred) for an aggregate purchase price of $300,000. Concurrently with its entry into this agreement, Barnes & Noble also entered into a commercial agreement with Microsoft, pursuant to which, among other things, the LLC would develop and distribute a Windows 8 application for eReading and digital content purchases, and an intellectual property license and settlement agreement with Microsoft and Microsoft Licensing GP. The parties closed Morrison’s investment in the LLC and the commercial agreement became effective on October 4, 2012.

On December 3, 2014, Morrison, Microsoft, Barnes & Noble and Barnes & Noble Education entered into agreements pursuant to which Morrison’s interest in the LLC was purchased by Barnes & Noble Education and the Microsoft commercial agreement was terminated effective as of such date. Pursuant to the Purchase Agreement (the Purchase Agreement) among Barnes & Noble, Barnes & Noble Education, Morrison, and Microsoft, Barnes & Noble Education purchased from Morrison, and Morrison sold, all of its $300,000 convertible Series A preferred limited liability company interest in the LLC in exchange for an aggregate purchase price of $124,850 consisting of (i) $62,425 in cash and (ii) 2,737,290 shares of common stock, par value $.001 per share, of Barnes & Noble. The Purchase Agreement closed on December 4, 2014. The Company accounted for this transaction in accordance with ASC 810-10, Non Controlling Interest (ASC 810-10) and accordingly was reflected as an equity transaction. In connection with the closing, the parties entered into a Digital Business Contingent Payment Agreement pursuant to which Microsoft is entitled to receive 22.7% of the proceeds from, among other events or transactions, (1) any future dividends or other distributions received from Barnes & Noble’s NOOK digital business at any time until the date that is three years from the closing, subject to a one-year extension under certain circumstances, and (2) the sale of Barnes & Noble’s NOOK digital business at any time until the date that is three years from the closing, subject to a one-year extension under certain circumstances.

Investment Agreement

Microsoft’s investment represented approximately 17.6% of the common membership interests in the LLC on an as-converted basis as of closing, with Barnes & Noble retaining the remaining ownership interests. This investment was classified as temporary equity in the mezzanine section of the balance sheet between liabilities and permanent equity, net of investment fees. The temporary equity designation was due to a potential put feature after five years from the closing of the investment agreement on the preferred membership interests. The preferred membership interests had a liquidation preference equal to the original investment. Upon the completion of the acquisition of Microsoft’s interest in the LLC, the temporary equity was converted to permanent equity.

Commercial Agreement

Under the commercial agreement, the LLC has developed certain applications for Windows 8 for purchasing and consumption of digital reading content and use efforts to expand internationally.

The commercial agreement provided for revenue sharing for digital content purchased from the LLC by customers using the LLC’s Windows 8 applications. Microsoft has made and was obligated to continue to make guaranteed advance payments to the LLC in connection with such revenue sharing equal to $60,000 per year. Microsoft also has paid and was obligated to continue to pay to the LLC $25,000 each year for purposes of assisting the LLC in acquiring local digital reading content and technology development in the performance of the LLC’s obligations under the commercial agreement.

The guaranteed advance payments in connection with revenue sharing as well as the amounts received for purposes of assisting the LLC in acquiring local digital reading content and technology development received from Microsoft were treated as debt in accordance with ASC 470-10-25-2, Sales of Future Revenues or Various Other Measures of Income. The Company estimated the cash flows associated with the commercial agreement and amortized the discount on the debt to interest expense over the term of the agreement in accordance with ASC 835-30-35-2, The Interest Method. Upon termination of this agreement, the Company has accounted for this transaction in accordance with several accounting codifications covering this topic that require transactions with related parties to be accounted for as equity transactions and accordingly the remaining debt balance of $197,316 included within other long term liabilities was converted to equity. Notwithstanding this treatment, the limited liability company agreement of the LLC provides that, under certain conditions, partnership losses or deductions can be allocated for income tax purposes to Microsoft in respect of amounts advanced to the LLC under the terms of the commercial agreement.

Settlement and License Agreement

The patent agreement provided for Microsoft and its subsidiaries to license to the Company and its affiliates certain intellectual property in exchange for royalty payments based on sales of certain devices. Additionally, the Company and Microsoft dismissed certain outstanding patent litigation between the Company, Microsoft and their respective affiliates in accordance with the settlement and license agreement. The Company recorded the royalty expense on NOOK® sales in the statement of operations in cost of sales and occupancy with no expense or liability for the sale of devices prior to this agreement.
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Pearson
 9 Months Ended
Jan. 31, 2015
Pearson
  17. Pearson

On December 21, 2012, the LLC entered into an agreement with a subsidiary of Pearson plc (Pearson) to make a strategic investment in the LLC. That transaction closed on January 22, 2013, and Pearson invested approximately $89,500 of cash in the LLC in exchange for preferred membership interests representing a 5% equity stake in the LLC. Following the closing of the transaction, Barnes & Noble owned approximately 78.2% of the LLC and Microsoft owned approximately 16.8%. The preferred membership interests had a liquidation preference equal to the original investment. In addition, the LLC granted warrants to Pearson to purchase up to an additional 5% of the LLC under certain conditions. Upon the completion of the acquisition of Pearson’s interest in the LLC, as stated below, the temporary equity was converted to permanent equity.

The fair value of the preferred membership interests warrant liability was calculated using the Monte Carlo simulation approach.

This methodology values financial instruments whose value is dependent on an underlying total equity value by sampling random paths for the total equity value. The assumptions that are analyzed and incorporated into the model include closing date, valuation date, sales price of the preferred membership interests and warrants, warrant expiration date, time to liquidity event, risk-free rate, volatility, various correlations and the probability of meeting the net sales target. Based on Barnes & Nobles’ analysis, the total fair value of preferred membership interests warrants as of the valuation date was $1,700 and was recorded as a noncurrent asset and a long-term liability. During the 13 weeks ended January 25, 2014, management determined that the probability of meeting the net sales target by the warrant measurement date was remote and fully wrote down the value of the warrant accordingly.

At closing, the LLC and Pearson entered into a commercial agreement with respect to distributing Pearson content in connection with this strategic investment. On December 27, 2013, the LLC entered into an amendment to the commercial agreement that extends the term of the agreement and the timing of the measurement period to meet certain revenue share milestones.

On December 22, 2014, Barnes & Noble entered into a Purchase Agreement (the Pearson Purchase Agreement) among Barnes & Noble, Barnes & Noble Education, NOOK Media Member Two LLC, a Delaware limited liability company (NOOK Member Two), Pearson Education, Inc. (Pearson Education) and Pearson Inc., pursuant to which Barnes & Noble Education and NOOK Member Two purchased from Pearson Education all of its convertible Series B preferred limited liability company interest in the LLC and all of its warrants to purchase additional Series B preferred limited liability company interests, in exchange for an aggregate purchase price equal to (i) $13,750 in cash and (ii) 602,927 shares of common stock, par value $.001 per share, of Barnes & Noble. The transactions under the Pearson Purchase Agreement closed on December 22, 2014. The Company accounted for this transaction in accordance with ASC 810-10 and accordingly was reflected as an equity transaction. As a condition to closing, the parties entered into an amended and restated Digital Business Contingent Payment Agreement, pursuant to which a Digital Business Contingent Payment Agreement dated as of December 3, 2014, by and between Barnes & Noble, the LLC and Pearson, was amended and restated to include provisions consistent with the Digital Business Contingent Payment Agreement entered into with Morrison on December 3, 2014.
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Samsung Commercial Agreement
 9 Months Ended
Jan. 31, 2015
Samsung Commercial Agreement
  18. Samsung Commercial Agreement

On June 4, 2014, NOOK Digital, LLC (NOOK Media Sub) (formerly barnesandnoble.com llc), a wholly owned subsidiary of B&N Education and a subsidiary of Barnes & Noble, entered into a commercial agreement (Agreement) with Samsung Electronics America, Inc. (Samsung) relating to tablets.

 

Pursuant to the Agreement, NOOK Media Sub, after good faith consultations with Samsung and subject to Samsung’s agreement, selected Samsung tablet devices under development to be customized and co-branded by NOOK Media Sub. Such devices are produced by Samsung. The co-branded NOOK® tablet devices are sold by NOOK Media Sub through Barnes & Noble retail stores, www.barnesandnoble.com, www.nook.com and other Barnes & Noble and NOOK Media websites. NOOK Media Sub and Samsung agreed to develop co-branded Samsung Galaxy Tab 4 NOOK® tablets as the initial co-branded devices pursuant to the Agreement.

Under the Agreement, NOOK Media Sub committed to purchase a minimum of 1,000,000 NOOK-Samsung co-branded devices from Samsung within 12 months after the launch of the initial co-branded device, which launch occurred on August 20, 2014. The 12-month period was automatically extended by three months due to the quantity of sales of such co-branded devices through December 31, 2014, and the period was further extended until June 30, 2016 by an amendment executed by the parties on March 7, 2015.

NOOK Media Sub and Samsung have agreed to coordinate customer service for the co-branded NOOK® devices and have both agreed to a license of intellectual property to promote and market the devices. Additionally, Samsung has agreed to fund a marketing fund for the co-branded NOOK® devices at the initial launch and for the duration of the Agreement.

The Agreement has a two year term, with certain termination rights, including termination (i) by NOOK Media Sub for a Samsung material default; (ii) by Samsung for a NOOK Media Sub material default; (iii) by NOOK Media Sub if Samsung fails to meet its shipping and delivery obligations in any material respect on a timely basis; and (iv) by either party upon insolvency or bankruptcy of the other party.

The companies introduced the Samsung Galaxy Tab 4 NOOK® in a 7-inch version in the U.S. in August 2014 and a 10-inch version in October 2014. The co-branded device combined the popular Samsung Galaxy Tab 4 hardware with customized NOOK® software to give customers powerful, full-featured tablets that are designed for reading, with easy access to Barnes & Noble’s expansive digital collection of approximately four million books, leading magazines and newspapers.
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Series J Preferred Stock
 9 Months Ended
Jan. 31, 2015
Series J Preferred Stock

19. Series J Preferred Stock

On August 18, 2011, the Company entered into an investment agreement between the Company and Liberty GIC, Inc. (Liberty) pursuant to which the Company issued and sold to Liberty, and Liberty purchased, 204,000 shares of the Company’s Series J Preferred Stock, par value $0.001 per share (Preferred Stock), for an aggregate purchase price of $204,000 in a private placement exempt from the registration requirements of the 1933 Act. The shares of Preferred Stock will be convertible, at the option of the holders, into shares of Common Stock representing 16.6% of the Common Stock outstanding as of August 29, 2011 (after giving pro forma effect to the issuance of the Preferred Stock) based on the initial conversion rate. The initial conversion rate reflects an initial conversion price of $17.00 and is subject to adjustment in certain circumstances. The initial dividend rate for the Preferred Stock is equal to 7.75% per annum of the initial liquidation preference of the Preferred Stock to be paid quarterly and subject to adjustment in certain circumstances.

On April 8, 2014, Liberty sold the majority of its shares to qualified institutional buyers in reliance on Rule 144A under the Securities Act and initially retained an approximate 10 percent stake of its initial investment. As a result, Liberty no longer has the right to elect two preferred stock directors to the Company’s Board. Additionally, the consent rights and pre-emptive rights to which Liberty was previously entitled ceased to apply.
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Shareholders' Equity
 9 Months Ended
Jan. 31, 2015
Shareholders' Equity
20. Shareholders’ Equity

On May 15, 2007, the Company’s Board of Directors authorized a stock repurchase program for the purchase of up to $400,000 of the Company’s common stock. The maximum dollar value of common stock that may yet be purchased under the current program is approximately $2,471 as of January 31, 2015. Stock repurchases under this program may be made through open market and privately negotiated transactions from time to time and in such amounts as management deems appropriate. As of January 31, 2015, the Company has repurchased 34,580,019 shares at a cost of approximately $1,073,424 since the inception of the Company’s stock repurchase programs. The repurchased shares are held in treasury.
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Legal Proceedings
 9 Months Ended
Jan. 31, 2015
Legal Proceedings
21. Legal Proceedings

The Company is involved in a variety of claims, suits, investigations and proceedings that arise from time to time in the ordinary course of its business, including actions with respect to contracts, intellectual property, taxation, employment, benefits, securities, personal injuries and other matters. The results of these proceedings in the ordinary course of business are not expected to have a material adverse effect on the Company’s consolidated financial position or results of operations.

The Company records a liability when it believes that it is both probable that a liability will be incurred, and the amount of loss can be reasonably estimated. The Company evaluates, at least quarterly, developments in its legal matters that could affect the amount of liability that has been previously accrued and makes adjustments as appropriate. Significant judgment is required to determine both probability and the estimated amount of a loss or potential loss. The Company may be unable to reasonably estimate the reasonably possible loss or range of loss for a particular legal contingency for various reasons, including, among others: (i) if the damages sought are indeterminate; (ii) if proceedings are in the early stages; (iii) if there is uncertainty as to the outcome of pending proceedings (including motions and appeals); (iv) if there is uncertainty as to the likelihood of settlement and the outcome of any negotiations with respect thereto; (v) if there are significant factual issues to be determined or resolved; (vi) if the proceedings involve a large number of parties; (vii) if relevant law is unsettled or novel or untested legal theories are presented; or (viii) if the proceedings are taking place in jurisdictions where the laws are complex or unclear. In such instances, there is considerable uncertainty regarding the ultimate resolution of such matters, including a possible eventual loss, if any. With respect to the legal matters described below, the Company has determined, based on its current knowledge, that the amount of loss or range of loss, that is reasonably possible including any reasonably possible losses in excess of amounts already accrued, is not reasonably estimable. However, legal matters are inherently unpredictable and subject to significant uncertainties, some of which are beyond the Company’s control. As such, there can be no assurance that the final outcome of these matters will not materially and adversely affect the Company’s business, financial condition, results of operations, or cash flows.

The following is a discussion of the material legal matters involving the Company.

PATENT LITIGATION

Barnes & Noble, Inc. and its subsidiaries are subject to allegations of patent infringement by various patent holders, including non-practicing entities, sometimes referred to as “patent trolls,” who may seek monetary settlements from the Company, its competitors, suppliers and resellers. In some of these cases, the Company is the sole defendant. In others, the Company is one of a number of defendants. The Company is actively defending a number of patent infringement suits, and several pending claims are in various stages of evaluation. The following cases are among the patent infringement cases pending against the Company:

Technology Properties Limited et al. v. Barnes & Noble, Inc., et al.

On July 24, 2012, Technology Properties Limited, LLC, Phoenix Digital Solutions, LLC, and Patriot Scientific Corporation (collectively, TPL) filed a complaint against the Company in the United States District Court for the Northern District of California. The complaint alleges that the Company is infringing U.S. Patent No. 5,809,336, U.S. Patent No. 5,440,749, and U.S. Patent No. 5,530,890 through the importation, manufacture, use, offer for sale, and/or sale in the United States of NOOKTM products. The District Court stayed the action between September 26, 2012 and May 19, 2014 during the pendency of a related U.S. International Trade Commission investigation. On June 9, 2014, the Company answered the complaint, denying TPL’s material allegations, asserting several affirmative defenses, and asserting counterclaims for a declaratory judgment of non-infringement and invalidity. On July 22, 2014, TPL served its preliminary infringement contentions. On September 12, 2014, the Company served its preliminary invalidity contentions.

On October 15, 2014, the District Judge overseeing the case found the case to be related to seven other pending cases in which TPL alleges that other defendants infringe the three asserted TPL patents. The District Judge then referred all eight cases to a Magistrate Judge for pretrial management purposes, including the preparation of a report and recommendation on claim construction and summary judgment. On November 20, 2014, the Magistrate Judge set various pretrial dates in the eight cases, including a July 22, 2015 fact discovery cutoff, a September 16, 2015 expert discovery cutoff, and a November 12, 2015 claim construction and summary judgment hearing. The Magistrate Judge did not set a trial date.

On February 4, 2015, the Company filed a motion for judgment on the pleadings directed to TPL’s U.S. Patent No. 5,809,336 (’336 patent) on the grounds that the ’336 patent is barred by the Kessler doctrine because the ITC previously found that the Company did not infringe the ’336 patent in the related ITC investigation and TPL chose not to appeal the ITC’s decision to the Federal Circuit. TPL has opposed the Company’s motion. Oral argument on the Company’s motion is scheduled on March 17, 2015.

Adrea LLC v. Barnes & Noble, Inc., barnesandnoble.com llc and Nook Media LLC

On June 14, 2013, Adrea LLC (Adrea) filed a complaint against Barnes & Noble, Inc., NOOK Digital, LLC (formerly barnesandnoble.com llc) and B&N Education, LLC (formerly NOOK Media LLC) (B&N) in the United States District Court for the Southern District of New York alleging that various B&N NOOK products and related online services infringe U.S. Patent Nos. 7,298,851, 7,299,501 and 7,620,703. B&N filed its Answer on August 9, 2013, denying infringement and asserting several affirmative defenses. At the same time, B&N filed counterclaims seeking declaratory judgments of non-infringement and invalidity with respect to each of the patents-in-suit. Following the claim construction hearing held on November 1, 2013 (as to which the Court issued a claim construction order on December 1, 2013), the Court set a further amended case management schedule, under which fact discovery was to be (and has been) substantially completed by November 20, 2013, and concluded by December 9, 2013; and expert disclosures and discovery were to be (and have been) completed by January 17, 2014. According to the amended case management schedule, summary judgment motion briefing was to have been, and has now been completed as of February 21, 2014. The final pretrial conference, originally scheduled to be held on February 28, 2014, was adjourned by the Court until April 10, 2014. On that date the summary judgment motions were orally argued to the Court, and the Court reserved decision on such motions until a later date. The parties then discussed various pretrial proceedings with the Court, and the Court set the date of October 6, 2014 for trial. Subsequently, on July 1, 2014, the Court issued a decision granting partial summary judgment in B&N’s favor, and in particular granting B&N’s motion to dismiss one of Adrea’s infringement claims, and granting B&N’s motion to limit any damages award with respect to another of Adrea’s infringement claims.

 

Beginning October 7, 2014, through and including October 22, 2014, the case was tried to a jury in the Southern District of New York. The jury returned its verdict on October 27, 2014. The jury found no infringement with respect to the ‘851 patent, and infringement with respect to the ‘501 and ‘703 patents. It awarded damages in the amount of $1,330. The jury further found no willful infringement with respect to any patent.

To date, the Court has yet to enter judgment, as it has requested post-trial briefing with respect to certain legal issues raised by the parties. Once it determines those issues and enters judgment, it is anticipated that the parties will file post-judgment motions, including, on B&N’s part, a motion for judgment in its favor as a matter of law, notwithstanding the jury’s verdict.

Commonwealth Scientific and Industrial Research Organisation v. Barnes & Noble, Inc., et al.

On August 27, 2012, Commonwealth Scientific and Industrial Research Organisation (CSIRO) filed a complaint against Barnes & Noble, Inc. and seven other defendants in the United States District Court for the Eastern District of Texas. The complaint alleges that the Company is infringing U.S. Patent No. 5,487,069 (’069 patent). On October 19, 2012, the Company answered the complaint, denying CSIRO’s material allegations, asserting several affirmative defenses, and asserting counterclaims for a declaratory judgment of invalidity and non-infringement. On February 19, 2013, the Company amended its answer to add an affirmative defense that the ’069 patent is unenforceable due to inequitable conduct. On November 23, 2013, the ’069 patent expired. On January 23, 2014, CSIRO served an amended complaint to allege that the Company is infringing the ’069 patent because its products may support the 802.11 ac and draft ac standards. In this amended complaint, CSIRO dropped its request for injunctive relief. On January 23, 2014, the Company served an amended answer to set forth additional Fair, Reasonable and Non-Discriminatory (F/RAND) related defenses and counterclaims: breach of contract, promissory estoppel, and waiver. On February 6, 2014, the Company and CSIRO responded to these amended pleadings.

On April 25, 2013, the District Court entered a discovery order and docket control order. On May 12, 2014, the Magistrate Judge assigned to the action issued a memorandum opinion and order in which the Magistrate Judge construed certain claim terms in the ‘069 patent and recommended denying Defendants’ motion for summary judgment of invalidity on the grounds of indefiniteness as to certain other claim terms in the ‘069 patent. On May 26 and 27, 2014, CSIRO and Defendants filed objections to the Magistrate Judge’s May 12, 2014 memorandum opinion and order. On August 5, 2014, the District Court overruled the parties’ objections. On August 15, 2014, Defendants filed a motion for partial summary judgment limiting damages; CSIRO has opposed Defendants’ motion, and the District Court has not yet ruled on the motion. On September 17, 2014, Defendants filed a letter brief requesting permission to file a motion for summary judgment of non-infringement; CSIRO has opposed Defendants’ request, and the District Court has not yet ruled on the request.

The District Court has set the trial date for July 13, 2015.

OTHER LITIGATION AND PROCEEDINGS

Kevin Khoa Nguyen, an individual, on behalf of himself and all others similarly situated v. Barnes & Noble, Inc.

On April 17, 2012, a complaint was filed in the Superior Court for the State of California against the Company. The complaint is styled as a nationwide class action and includes a California state-wide subclass based on alleged cancellations of orders for HP TouchPad Tablets placed on the Company’s website in August 2011. The lawsuit alleges claims for unfair business practices and false advertising under both New York and California state law, violation of the Consumer Legal Remedies Act under California law, and breach of contract. The complaint demands specific performance of the alleged contracts to sell HP TouchPad Tablets at a specified price, injunctive relief, and monetary relief, but does not specify an amount. The Company submitted its initial response to the complaint on May 18, 2012, removing the case to the United States District Court for the Central District of California, and moved to compel plaintiff to arbitrate his claims on an individual basis pursuant to a contractual arbitration provision on May 25, 2012. The Company has also moved to dismiss the complaint and moved to transfer the action to New York. The court denied the Company’s motion to compel arbitration, and the Company appealed that denial to the Ninth Circuit Court of Appeals. The court granted the Company’s motion to stay on November 26, 2012, and the action had been stayed pending resolution of the Company’s appeal from the court’s denial of its motion to compel arbitration. On August 18, 2014, the Ninth Circuit Court of Appeals affirmed the district court’s denial of the Company’s motion to compel arbitration. On September 2, 2014, the Company filed a petition for rehearing and rehearing en banc in the Ninth Circuit Court of Appeals. On October 14, 2014, the court denied the Company’s petition for rehearing and rehearing en banc, and on October 23, 2014, the mandate issued returning the case to the United States District Court for the Central District of California. The Company then refiled its motion to dismiss the complaint and motion to transfer the action to New York. On February 17, 2015, the court denied the Company’s motion to transfer. The Company’s motion to dismiss was taken under submission by the court on February 20, 2015, after oral argument. The parties are engaging in discovery and pursuant to the court’s scheduling order dated December 17, 2014, all dates for the case have been scheduled, including the deadline for plaintiff to file for class certification of April 24, 2015, and trial date of May 3, 2016.

 

PIN Pad Litigation

As previously disclosed, the Company discovered that PIN pads in certain of its stores had been tampered with to allow criminal access to card data and PIN numbers on credit and debit cards swiped through the terminals. Following public disclosure of this matter on October 24, 2012, the Company was served with four putative class action complaints (three in federal district court in the Northern District of Illinois and one in the Northern District of California), each of which alleged on behalf of national and other classes of customers who swiped credit and debit cards in Barnes & Noble Retail stores common law claims such as negligence, breach of contract and invasion of privacy, as well as statutory claims such as violations of the Fair Credit Reporting Act, state data breach notification statutes, and state unfair and deceptive practices statutes. The actions sought various forms of relief including damages, injunctive or equitable relief, multiple or punitive damages, attorneys’ fees, costs, and interest. All four cases were transferred and/or assigned to a single judge in the United States District Court for the Northern District of Illinois, and a single consolidated amended complaint was filed. The Company filed a motion to dismiss the consolidated amended complaint in its entirety, and in September 2013, the Court granted the motion to dismiss without prejudice. The Plaintiffs then filed an amended complaint, and the Company filed a second motion to dismiss. That motion is pending.

The Company also has received inquiries related to this matter from the Federal Trade Commission and eight state attorneys general, all of which have either been closed or have not had any recent activity. The Company intends to cooperate with them if further activity arises. In addition, payment card companies and associations may impose fines by reason of the tampering and federal or state enforcement authorities may impose penalties or other remedies against the Company.

Lina v. Barnes & Noble, Inc., and Barnes & Noble Booksellers, Inc. et al.

On August 5, 2011, a purported class action complaint was filed against Barnes & Noble, Inc. and Barnes & Noble Booksellers, Inc. in the Superior Court for the State of California making the following allegations with respect to salaried Store Managers at Barnes & Noble stores located in California from August 5, 2007 to present: (1) failure to pay wages and overtime; (2) failure to pay for missed meals and/or rest breaks; (3) waiting time penalties; (4) failure to pay minimum wage; (5) failure to reimburse for business expenses; and (6) failure to provide itemized wage statements. The claims are generally derivative of the allegation that these salaried managers were improperly classified as exempt from California’s wage and hour laws. The complaint contains no allegations concerning the number of any such alleged violations or the amount of recovery sought on behalf of the purported class. The Company was served with the complaint on August 11, 2011. On July 1, 2014 the court denied plaintiff’s motion for class certification. The court ruled that plaintiff failed to satisfy his burden to demonstrate common issues predominated over individual issues, that plaintiff was a sufficient class representative, or that a class action was a superior method to adjudicate plaintiff’s claims. Plaintiff filed a notice of appeal on August 29, 2014. No appellate briefing schedule has been set. On November 18, 2014, the trial court stayed all proceedings pending appeal. On January 14, 2015, Barnes & Noble removed the action to federal court based on new United States Supreme Court authority. On February 13, 2015 plaintiff filed a motion to remand. The Company filed its Opposition on February 23, 2015. The hearing date for the motion to remand is March 23, 2015.

Jones et al v. Barnes & Noble, Inc., and Barnes & Noble Booksellers, Inc. et al.

On April 23, 2013, Kenneth Jones (Jones) filed a purported Private Attorney General Act action complaint against Barnes & Noble, Inc. and Barnes & Noble Booksellers, Inc. in the Superior Court for the State of California making the following allegations with respect to salaried Store Managers at Barnes & Noble stores located in California: (1) failure to pay wages and overtime; (2) failure to pay for missed meal and/or rest breaks; (3) waiting time penalties; (4) failure to pay minimum wage; (5) failure to provide reimbursement for business expenses; and (6) failure to provide itemized wage statements. The claims are generally derivative of the allegation that Jones and other “aggrieved employees” were improperly classified as exempt from California’s wage and hour laws. The complaint contains no allegations concerning the number of any such alleged violations or the amount of recovery sought on behalf of the plaintiff or the purported aggrieved employees. On May 7, 2013, Judge Michael Johnson (before whom the Lina action is pending) ordered the Jones action related to the Lina action and assigned the Jones action to himself. The Company was served with the complaint on May 16, 2013 and answered on June 10, 2013. On November 18, 2014, the court stayed all proceedings pending appeal in the related Lina action.

Cassandra Carag individually and on behalf of others similarly situated v. Barnes & Noble, Inc, Barnes & Noble Booksellers, Inc. and DOES 1 through 100 inclusive

On November 27, 2013, former Associate Store Manager Cassandra Carag (Carag) brought suit in Sacramento County Superior Court, asserting claims on behalf of herself and all other hourly (non-exempt) Barnes & Noble employees in California in the preceding four years for unpaid regular and overtime wages based on alleged off-the-clock work, penalties and pay based on missed meal and rest breaks, and for improper wage statements, payroll records, and untimely pay at separation as a result of the alleged pay errors during employment. Via the complaint, Carag seeks to recover unpaid wages and statutory penalties for all hourly Barnes & Noble employees within California from November 27, 2009 to present. On February 13, 2014, the Company filed an Answer in the state court and concurrently requested removal of the action to federal court. On May 30, 2014, the Court granted Plaintiff’s motion to remand the case to state court and denied Plaintiff’s motion to strike portions of the Answer to the Complaint (referring the latter motion to the lower court for future consideration). On September 2, 2014, the Court denied Plaintiff’s motion to disqualify counsel based on their prior role in the Lina matter. On January 14, 2015, the Company removed the case to federal court based on new US Supreme Court authority. On February 13, 2015, plaintiff filed a motion to remand which has not yet been fully-briefed. A hearing on the remand motion is scheduled on March 13, 2015, and a pre-trial conference is scheduled for May 28, 2015.

Trimmer v. Barnes & Noble

On January 25, 2013, Steven Trimmer (Trimmer), a former Assistant Store Manager (ASM) of the Company, filed a complaint in the United States District Court for the Southern District of New York alleging violations of the Fair Labor Standards Act (FLSA) and New York Labor Law (NYLL). Specifically, Trimmer alleges that he and other similarly situated ASMs were improperly classified as exempt from overtime and denied overtime wages prior to July 1, 2010, when the Company reclassified them as non-exempt. The complaint seeks to certify a collective action under the FLSA comprised of ASMs throughout the country employed from January 25, 2010 until July 1, 2010, and a class action under the NYLL comprised of ASMs employed in New York from January 25, 2007 until July 1, 2010. The parties have completed the first phase of discovery with respect to the individual claims asserted by Trimmer and one opt-in plaintiff only. The Company filed a summary judgment motion on November 25, 2013, which was denied on July 18, 2014. Trimmer filed a motion for conditional certification under the FLSA and class certification under the NYLL on November 7, 2014, which was fully briefed and submitted to the Court on December 15, 2014. The Court has not yet set a hearing date for the pending class certification motion. On February 17, 2015, the parties submitted a joint request that the pending class certification motion be stayed for thirty days so that the parties could engage in settlement discussions. The Court has not yet ruled on that joint request.

Securities and Exchange Commission (SEC) Investigation

On October 16, 2013, the SEC’s New York Regional office notified the Company that it had commenced an investigation into: (1) the Company’s restatement of earnings announced on July 29, 2013, and (2) a separate matter related to a former non-executive employee’s allegation that the Company improperly allocated certain Information Technology expenses between its NOOK and Retail segments for purposes of segment reporting. The Company is cooperating with the SEC, including responding to requests for documents.
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Recent Accounting Pronouncements
 9 Months Ended
Jan. 31, 2015
Recent Accounting Pronouncements
22. Recent Accounting Pronouncements

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (ASU 2014-09). The standard provides companies with a single model for use in accounting for revenue arising from contracts with customers and supersedes current revenue recognition guidance, including industry-specific revenue guidance. The core principle of the model is to recognize revenue when control of the goods or services transfers to the customer, as opposed to recognizing revenue when the risks and rewards transfer to the customer under the existing revenue guidance. ASU 2014-09 is effective for annual reporting periods beginning after December 15, 2016. Early adoption is not permitted. The guidance permits companies to either apply the requirements retrospectively to all prior periods presented, or apply the requirements in the year of adoption, through a cumulative adjustment. The Company has not yet selected a transition method nor has it determined the impact of adoption on its consolidated financial statements.

In July 2013, the FASB issued ASU No. 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (ASU 2013-11). ASU 2013-11 requires an entity to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit, in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. ASU 2013-11 is effective for financial statements issued for annual reporting periods beginning after December 15, 2013 and interim periods within those years. The Company adopted ASU 2013-11 in the first quarter of fiscal 2015 with no significant impact to its consolidated financial statements.
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Net Earnings (Loss) per Share (Tables)
 9 Months Ended
Jan. 31, 2015
Reconciliation of Basic and Diluted Income (Loss) Per Share

The following is a reconciliation of the Company’s basic and diluted income (loss) per share calculation:

 

     13 weeks ended      39 weeks ended  
     January 31,
2015		      January 25,
2014		      January 31,
2015		      January 25,
2014		  

Numerator for basic income (loss) per share:

            

Net income (loss) attributable to Barnes & Noble, Inc.

    $ 72,168         63,230       $ 56,017         (10,564 ) 

Preferred stock dividends

      (3,942 )       (3,942 )       (11,825 )       (11,825 ) 

Accretion of dividends on preferred stock

      (5,507 )       (316 )       (7,024 )       (947 ) 

Less allocation of earnings and dividends to participating securities

      (3,380 )       (2,604 )       (2,171 )       —    
  

 

 

     

 

 

     

 

 

     

 

 

  

Net income (loss) available to common shareholders

 $ 59,339      56,368    $ 34,997      (23,336 ) 
  

 

 

     

 

 

     

 

 

     

 

 

  

Numerator for diluted income (loss) per share:

Net income (loss) available to common shareholders

 $ 59,339      56,368    $ 34,997      (23,336 ) 

Preferred stock dividends (a)

   3,942      3,942      —       —    

Accretion of dividends on preferred stock (a)(b)

   5,507      316      —       —    

Allocation of earnings and dividends to participating securities

   3,380      2,604      2,171     —    

Less diluted allocation of earnings and dividends to participating securities

   (3,278 )    (2,338 )    (2,168 )    —    
  

 

 

     

 

 

     

 

 

     

 

 

  

Net income (loss) available to common shareholders

 $ 68,890      60,892    $ 35,000      (23,336 ) 

Denominator for basic income (loss) per share:

Basic weighted average common shares

   61,589      59,033      60,056      58,919   

Denominator for diluted income (loss) per share:

Basic weighted average common shares

   61,589      59,033      60,056      58,919   

Preferred shares (a)

   12,000      12,000      —       —    

Average dilutive options

   122      —       72     —    
  

 

 

     

 

 

     

 

 

     

 

 

  

Diluted weighted average common shares

   73,711      71,033      60,128      58,919   

Income (loss) per common share:

Basic

 $ 0.96      0.95    $ 0.58      (0.40 ) 

Diluted

 $ 0.93      0.86    $ 0.58      (0.40 ) 

 

(a) Although the Company was in a net income position during the 39 weeks ended January 31, 2015, the dilutive effect of the Company’s convertible preferred shares were excluded from the calculation of income per share using the two-class method because the effect would be antidilutive.
(b) Includes accretion of dividends on the preferred membership interests, of which $4,897 was accelerated during the 13 weeks ended January 31, 2015 in connection with the re-acquired preferred membership interests.
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Segment Reporting (Tables)
 9 Months Ended
Jan. 31, 2015
Summarized Financial Information of Reportable Segments

Summarized financial information concerning the Company’s reportable segments is presented below:

 

Sales by Segment    13 weeks ended     39 weeks ended  
     January 31,
2015		     January 25,
2014		     January 31,
2015		     January 25,
2014		  

B&N Retail

    $ 1,395,917      $ 1,410,308      $ 3,238,883      $ 3,339,533   

B&N College

      521,019        486,221        1,498,389        1,449,776   

NOOK

      77,509           156,866           211,402           418,736      

Elimination

      (33,294 )      (57,605 )      (63,256 )      (148,594 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Total

 $ 1,961,151    $ 1,995,790    $ 4,885,418    $ 5,059,451   
  

 

 

    

 

 

    

 

 

    

 

 

  

 

Sales by Product Line    13 weeks ended     39 weeks ended  
     January 31,
2015		     January 25,
2014		     January 31,
2015		     January 25,
2014		  

Media (a)

      69 %      67 %      70 %      68 % 

Digital (b)

      5 %      9 %      5 %      9 % 

Other (c)

      26 %      24 %      25 %      23 % 
  

 

 

    

 

 

    

 

 

    

 

 

  

Total

              100 %               100 %               100 %               100 % 
  

 

 

    

 

 

    

 

 

    

 

 

  

 

Depreciation and Amortization    13 weeks ended     39 weeks ended  
     January 31,
2015		     January 25,
2014		     January 31,
2015		     January 25,
2014		  

B&N Retail

    $ 25,581      $ 31,975      $ 79,953      $ 96,193   

B&N College

      12,582        11,895        37,635        35,271   

NOOK

      9,690           10,486           29,997           31,575      
  

 

 

    

 

 

    

 

 

    

 

 

  

Total

 $     47,853    $     54,356    $   147,585    $   163,039   
  

 

 

    

 

 

    

 

 

    

 

 

  

 

Operating Profit (Loss)    13 weeks ended     39 weeks ended  
     January 31,
2015		     January 25,
2014		     January 31,
2015		     January 25,
2014		  

B&N Retail

    $ 173,010      $ 167,639      $ 210,127      $   204,757   

B&N College

      15,527           23,354           38,549           65,200      

NOOK

      (39,016 )      (72,277 )      (101,513 )      (193,200 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Total

 $   149,521    $   118,716    $   147,163    $ 76,757   
  

 

 

    

 

 

    

 

 

    

 

 

  

 

Capital Expenditures    13 weeks ended     39 weeks ended  
     January 31,
2015		     January 25,
2014		     January 31,
2015		     January 25,
2014		  

B&N Retail

    $ 13,013      $ 11,319      $ 48,297      $ 45,699   

B&N College

      10,501           7,285           35,106           28,359      

NOOK

      4,455        7,437        17,370        22,120   
  

 

 

    

 

 

    

 

 

    

 

 

  

Total

 $     27,969    $     26,041    $   100,773    $     96,178   
  

 

 

    

 

 

    

 

 

    

 

 

  

 

Total Assets (d)    January 31,
2015		      January 25,
2014		  

B&N Retail

    $ 2,191,225       $ 2,279,609   

B&N College

      1,536,723         1,526,698   

NOOK

      148,295         334,870   
  

 

 

     

 

 

  

Total

 $ 3,876,243    $ 4,141,177   
  

 

 

     

 

 

  

 

(a) Includes tangible books, music, movies, rentals and newsstand.
(b) Includes NOOK, related accessories, eContent and warranties.
(c) Includes Toys & Games, café products, college apparel, gifts and miscellaneous other.
(d) Excludes intercompany balances.
Reconciliation of Operating Income from Reportable Segments

A reconciliation of operating income from reportable segments to income from continuing operations before taxes in the consolidated financial statements is as follows:

 

     13 weeks ended      39 weeks ended  
     January 31,
2015		      January 25,
2014		      January 31,
2015		      January 25,
2014		  

Reportable segments operating profit

    $ 149,521       $ 118,716       $ 147,163       $ 76,757   

Interest expense, net and amortization of deferred financing costs

      3,552         7,761         14,774         22,868   
  

 

 

     

 

 

     

 

 

     

 

 

  

Consolidated income before taxes

 $ 145,969    $ 110,955    $ 132,389    $ 53,889   
  

 

 

     

 

 

     

 

 

     

 

 

  
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Intangible Assets and Goodwill (Tables)
 9 Months Ended
Jan. 31, 2015
Amortizable Intangible Assets and Unamortizable Intangible Assets
          As of January 31, 2015  

Amortizable Intangible Assets:

    Useful
Life		    Gross Carrying
Amount		      Accumulated
Amortization		      Total  

Customer relationships

    4-25    $ 271,938       $ (71,337 )     $ 200,601   

Technology

    4-10      10,710         (8,402 )       2,308   

Distribution contracts

    10      8,325         (7,534 )       791   

Other

    2-10      6,419         (6,203 )       216   
     

 

 

     

 

 

     

 

 

  
$ 297,392    $ (93,476 )  $ 203,916   
     

 

 

     

 

 

     

 

 

  

 

Unamortizable Intangible Assets:

       

Trade name

    $ 293,400   

Publishing contracts

      19,734   
  

 

 

  
$ 313,134   
  

 

 

  

Total amortizable and unamortizable intangible assets

 $ 517,050   
  

 

 

  
Aggregate Amortization Expense

Aggregate Amortization Expense:

       

For the 39 weeks ended January 31, 2015

    $ 11,527   

For the 39 weeks ended January 25, 2014

    $ 13,584   
Estimated Amortization Expense

Estimated Amortization Expense:

       

(12 months ending on or about April 30)

   

2015

    $ 14,713   

2016

    $ 11,227   

2017

    $ 10,957   

2018

    $ 10,732   

2019

    $ 10,520   
Carrying Amount of Goodwill by Segment

The carrying amount of goodwill by segment as of January 31, 2015 is as follows:

 

     B&N Retail
Segment		      B&N College
Segment		      Total
Company		  

Balance as of January 31, 2015

    $ 219,119         274,070       $ 493,189   
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Other Long-Term Liabilities (Tables)
 9 Months Ended
Jan. 31, 2015
Long-Term Liabilities

The Company had the following long-term liabilities at January 31, 2015, January 25, 2014 and May 3, 2014:

 

     January 31,
2015		      January 25,
2014		      May 3,
2014		  

Deferred rent

    $ 99,028       $ 132,620       $ 128,280   

Microsoft Commercial Agreement financing transaction (see Note 16)

      —           119,467         140,714   

Tax liabilities and reserves

      72,133         40,814         51,399   

Pension liability (see Note 15)

      16,652         19,048         11,154   

Other

      29,380         19,356         35,442   
  

 

 

     

 

 

     

 

 

  

Total long-term liabilities

 $ 217,193    $ 331,305    $ 366,989   
  

 

 

     

 

 

     

 

 

  

 
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Stock-Based Compensation (Tables)
 9 Months Ended
Jan. 31, 2015
Stock-Based Compensation Expense in Selling and Administrative Expenses

For the 13 and 39 weeks ended January 31, 2015 and January 25, 2014, the Company recognized stock-based compensation expense in selling and administrative expenses as follows:

 

     13 weeks ended      39 weeks ended  
     January 31,
2015		      January 25,
2014		      January 31,
2015		      January 25,
2014		  

Restricted Stock Expense

    $ 248         390       $ 799         1,683   

Restricted Stock Units Expense

      2,990         1,694         13,594         7,688   

Stock Option Expense

      214         382         2,330         (1,224 ) 
  

 

 

     

 

 

     

 

 

     

 

 

  

Stock-Based Compensation Expense

 $ 3,452      2,466    $ 16,723      8,147   
  

 

 

     

 

 

     

 

 

     

 

 

  
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History of B&N Education, Inc. - Additional Information (Detail)
 Dec. 22, 2014
 Oct. 04, 2012
 Jan. 31, 2015
 Jan. 22, 2013
B&N Education, LLC
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Percentage of non controlling interest 17.60%
Percentage of membership interest 100.00% 82.40%
Pearson Plc
Organization Consolidation And Presentation Of Financial Statements [Line Items]
Percentage of membership interest 5.00% 5.00%
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Revenue Recognition - Additional Information (Detail) (USD $)
 9 Months Ended
Jan. 31, 2015
 May 03, 2014
 Jan. 25, 2014
Deferred Revenue Arrangement [Line Items]
Estimated life of NOOK, years 2 years
Nook
Deferred Revenue Arrangement [Line Items]
Recognized over 2 years
Deferred revenue $ 3,613,000 $ 9,934,000 $ 13,348,000
Nook | Minimum
Deferred Revenue Arrangement [Line Items]
Average percent, NOOK's sales price 0.00%
Nook | Maximum
Deferred Revenue Arrangement [Line Items]
Average percent, NOOK's sales price 4.00%
Annual Fee
Deferred Revenue Arrangement [Line Items]
Non-refundable, after first 30 days, annual fee $ 25
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Net Earnings (Loss) Per Share - Additional Information (Detail)
 9 Months Ended
Jan. 25, 2014
Participating Securities
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Securities excluded from the calculation of earnings per share 2,748,293
Stock Options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Securities excluded from the calculation of earnings per share 40,491
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Reconciliation of Basic and Diluted Income (Loss) Per Share (Detail) (USD $)
In Thousands, except Per Share data, unless otherwise specified		 3 Months Ended 9 Months Ended
Jan. 31, 2015
 Jan. 25, 2014
 Jan. 31, 2015
 Jan. 25, 2014
Numerator for basic income (loss) per share:
Net income (loss) attributable to Barnes & Noble, Inc. $ 72,168 $ 63,230 $ 56,017 $ (10,564)
Preferred stock dividends (3,942) (3,942) (11,825) (11,825)
Accretion of dividends on preferred stock (5,507) (316) (7,024) (947)
Less allocation of earnings and dividends to participating securities (3,380) (2,604) (2,171)
Net income (loss) available to common shareholders 59,339 56,368 34,997 (23,336)
Numerator for diluted income (loss) per share:
Net income (loss) available to common shareholders 59,339 56,368 34,997 (23,336)
Preferred stock dividends 3,942 [1] 3,942 [1]
Accretion of dividends on preferred stock 5,507 [1],[2] 316 [1],[2]
Allocation of earnings and dividends to participating securities 3,380 2,604 2,171
Less diluted allocation of earnings and dividends to participating securities (3,278) (2,338) (2,168)
Net income (loss) available to common shareholders $ 68,890 $ 60,892 $ 35,000 $ (23,336)
Denominator for basic income (loss) per share:
Basic weighted average common shares 61,589 59,033 60,056 58,919
Denominator for diluted income (loss) per share:
Basic weighted average common shares 61,589 59,033 60,056 58,919
Preferred shares 12,000 [1] 12,000 [1]
Average dilutive options 122 72
Diluted weighted average common shares 73,711 71,033 60,128 58,919
Income (loss) per common share:
Basic $ 0.96 $ 0.95 $ 0.58 $ (0.4)
Diluted $ 0.93 $ 0.86 $ 0.58 $ (0.4)
[1] Although the Company was in a net income position during the 39 weeks ended January 31, 2015, the dilutive effect of the Company's convertible preferred shares were excluded from the calculation of income per share using the two-class method because the effect would be antidilutive.
[2] Includes accretion of dividends on the preferred membership interests, of which $4,897 was accelerated during the 13 weeks ended January 31, 2015 in connection with the re-acquired preferred membership interests.
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Reconciliation of Basic and Diluted Income (Loss) Per Share (Parenthetical) (Detail) (USD $)
In Thousands, unless otherwise specified		 3 Months Ended
Jan. 31, 2015
 Jan. 25, 2014
Accretion of dividends on preferred stock $ 5,507 [1],[2] $ 316 [1],[2]
B&N Education, LLC
Accretion of dividends on preferred stock $ 4,897
[1] Although the Company was in a net income position during the 39 weeks ended January 31, 2015, the dilutive effect of the Company's convertible preferred shares were excluded from the calculation of income per share using the two-class method because the effect would be antidilutive.
[2] Includes accretion of dividends on the preferred membership interests, of which $4,897 was accelerated during the 13 weeks ended January 31, 2015 in connection with the re-acquired preferred membership interests.
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Segment Reporting - Additional Information (Detail)
 9 Months Ended
Jan. 31, 2015
Segment
Segment Reporting Information [Line Items]
Number of operating segments 3
B&N Retail
Segment Reporting Information [Line Items]
Number of stores 649
B&N College
Segment Reporting Information [Line Items]
Number of stores 717
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Summarized Financial Information Reportable Segments (Detail) (USD $)
In Thousands, unless otherwise specified		 3 Months Ended 9 Months Ended
Jan. 31, 2015
 Jan. 25, 2014
 Jan. 31, 2015
 Jan. 25, 2014
 May 03, 2014
Segment Reporting Information [Line Items]
Sales $ 1,961,151 $ 1,995,790 $ 4,885,418 $ 5,059,451
Sales by Product Line 100.00% 100.00% 100.00% 100.00%
Depreciation and amortization 47,853 54,356 147,585 163,039
Operating Profit/(Loss) 149,521 118,716 147,163 76,757
Capital Expenditures 27,969 26,041 100,773 96,178
Total Assets 3,876,243 [1] 4,141,177 [1] 3,876,243 [1] 4,141,177 [1] 3,537,449
Media
Segment Reporting Information [Line Items]
Sales by Product Line 69.00% [2] 67.00% [2] 70.00% [2] 68.00% [2]
Digital
Segment Reporting Information [Line Items]
Sales by Product Line 5.00% [3] 9.00% [3] 5.00% [3] 9.00% [3]
Other
Segment Reporting Information [Line Items]
Sales by Product Line 26.00% [4] 24.00% [4] 25.00% [4] 23.00% [4]
B&N Retail
Segment Reporting Information [Line Items]
Total Assets 2,191,225 [1] 2,279,609 [1] 2,191,225 [1] 2,279,609 [1]
B&N College
Segment Reporting Information [Line Items]
Total Assets 1,536,723 [1] 1,526,698 [1] 1,536,723 [1] 1,526,698 [1]
Nook
Segment Reporting Information [Line Items]
Total Assets 148,295 [1] 334,870 [1] 148,295 [1] 334,870 [1]
Operating Segments | B&N Retail
Segment Reporting Information [Line Items]
Sales 1,395,917 1,410,308 3,238,883 3,339,533
Depreciation and amortization 25,581 31,975 79,953 96,193
Operating Profit/(Loss) 173,010 167,639 210,127 204,757
Capital Expenditures 13,013 11,319 48,297 45,699
Operating Segments | B&N College
Segment Reporting Information [Line Items]
Sales 521,019 486,221 1,498,389 1,449,776
Depreciation and amortization 12,582 11,895 37,635 35,271
Operating Profit/(Loss) 15,527 23,354 38,549 65,200
Capital Expenditures 10,501 7,285 35,106 28,359
Operating Segments | Nook
Segment Reporting Information [Line Items]
Sales 77,509 156,866 211,402 418,736
Depreciation and amortization 9,690 10,486 29,997 31,575
Operating Profit/(Loss) (39,016) (72,277) (101,513) (193,200)
Capital Expenditures 4,455 7,437 17,370 22,120
Elimination
Segment Reporting Information [Line Items]
Sales $ (33,294) $ (57,605) $ (63,256) $ (148,594)
[1] Excludes intercompany balances.
[2] Includes tangible books, music, movies, rentals and newsstand.
[3] Includes NOOK, related accessories, eContent and warranties.
[4] Includes Toys & Games, café products, college apparel, gifts and miscellaneous other.
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Reconciliation of Operating Income from Reportable Segments (Detail) (USD $)
In Thousands, unless otherwise specified		 3 Months Ended 9 Months Ended
Jan. 31, 2015
 Jan. 25, 2014
 Jan. 31, 2015
 Jan. 25, 2014
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Reportable segments operating profit $ 149,521 $ 118,716 $ 147,163 $ 76,757
Interest expense, net and amortization of deferred financing costs 3,552 7,761 14,774 22,868
Consolidated income before taxes $ 145,969 $ 110,955 $ 132,389 $ 53,889
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Amortizable Intangible Assets and Unamortizable Intangible Assets (Detail) (USD $)
In Thousands, unless otherwise specified		 9 Months Ended
Jan. 31, 2015
 May 03, 2014
 Jan. 25, 2014
Intangible Assets by Major Class [Line Items]
Gross Carrying Amount 297,392
Accumulated Amortization (93,476)
Total 203,916
Unamortizable intangible assets 313,134
Total amortizable and unamortizable, intangible assets 517,050 528,576 532,761
Trade name
Intangible Assets by Major Class [Line Items]
Unamortizable intangible assets 293,400
Publishing contracts
Intangible Assets by Major Class [Line Items]
Unamortizable intangible assets 19,734
Customer relationships
Intangible Assets by Major Class [Line Items]
Gross Carrying Amount 271,938
Accumulated Amortization (71,337)
Total 200,601
Customer relationships | Minimum
Intangible Assets by Major Class [Line Items]
Useful Life 4 years
Customer relationships | Maximum
Intangible Assets by Major Class [Line Items]
Useful Life 25 years
Technology
Intangible Assets by Major Class [Line Items]
Gross Carrying Amount 10,710
Accumulated Amortization (8,402)
Total 2,308
Technology | Minimum
Intangible Assets by Major Class [Line Items]
Useful Life 4 years
Technology | Maximum
Intangible Assets by Major Class [Line Items]
Useful Life 10 years
Distribution contracts
Intangible Assets by Major Class [Line Items]
Useful Life 10 years
Gross Carrying Amount 8,325
Accumulated Amortization (7,534)
Total 791
Other
Intangible Assets by Major Class [Line Items]
Gross Carrying Amount 6,419
Accumulated Amortization (6,203)
Total 216
Other | Minimum
Intangible Assets by Major Class [Line Items]
Useful Life 2 years
Other | Maximum
Intangible Assets by Major Class [Line Items]
Useful Life 10 years
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Aggregate Amortization Expense (Detail) (USD $)
In Thousands, unless otherwise specified		 9 Months Ended
Jan. 31, 2015
 Jan. 25, 2014
Goodwill and Intangible Assets Disclosure [Line Items]
Aggregate Amortization Expense $ 11,527 $ 13,584
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Estimated Amortization Expense (Detail) (USD $)
In Thousands, unless otherwise specified		 Jan. 31, 2015
Estimated Amortization Expense [Line Items]
2015 $ 14,713
2016 11,227
2017 10,957
2018 10,732
2019 $ 10,520
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Carrying Amount of Goodwill by Segment (Detail) (USD $)
In Thousands, unless otherwise specified		 Jan. 31, 2015
 May 03, 2014
 Jan. 25, 2014
Goodwill [Line Items]
Goodwill $ 493,189 $ 493,189 $ 495,496
B&N Retail
Goodwill [Line Items]
Goodwill 219,119
B&N College
Goodwill [Line Items]
Goodwill $ 274,070
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Gift Cards - Additional Information (Detail) (USD $)
 3 Months Ended 9 Months Ended
Jan. 31, 2015
 Jan. 25, 2014
 Jan. 31, 2015
 Jan. 25, 2014
 May 03, 2014
Gift Cards [Line Items]
Additional gift card breakage during the period $ 4,300,000
Gift card breakage 10,126,000 5,831,000 21,259,000 17,503,000
Gift card liabilities $ 390,102,000 $ 392,244,000 $ 390,102,000 $ 392,244,000 $ 356,700,000
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Long-Term Liabilities (Detail) (USD $)
In Thousands, unless otherwise specified		 Jan. 31, 2015
 May 03, 2014
 Jan. 25, 2014
Other Long-Term Liabilities [Abstract]
Deferred rent $ 99,028 $ 128,280 $ 132,620
Microsoft Commercial Agreement financing transaction (see Note 16) 140,714 119,467
Tax liabilities and reserves 72,133 51,399 40,814
Pension liability (see Note 15) 16,652 11,154 19,048
Other 29,380 35,442 19,356
Total long-term liabilities $ 217,193 $ 366,989 $ 331,305
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Income Taxes - Additional Information (Detail) (USD $)
In Thousands, unless otherwise specified		 3 Months Ended 9 Months Ended
Jan. 31, 2015
 Jan. 25, 2014
 Jan. 31, 2015
 Jan. 25, 2014
Income Taxes [Line Items]
Income taxes $ 73,801 $ 47,725 $ 76,372 $ 64,453
Income (loss) before taxes 145,969 110,955 132,389 53,889
Effective income tax rate 50.60% 43.00% 57.70% 119.60%
Operating losses impact on income tax provisions 149,521 118,716 147,163 76,757
Valuation allowance 5,972 5,972
Joint Venture Partner
Income Taxes [Line Items]
Operating losses impact on income tax provisions $ (63,042) $ (105,542)
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Credit Facility - Additional Information (Detail) (USD $)
 0 Months Ended 9 Months Ended
Apr. 29, 2011
 Jan. 31, 2015
 Jan. 25, 2014
Line of Credit Facility [Line Items]
Line of credit facility, amount outstanding 0 $ 0
Letters of credit, outstanding amount 67,264,000 34,363,000
Amended Credit Agreement
Line of Credit Facility [Line Items]
Credit facility, borrowing capacity 1,000,000,000
Credit facility maturity term, in years 5 years
Option to increase in commitments under credit agreement, maximum 300,000,000
Credit facility, expiration date Apr 29, 2016
Percentage of Loan Cap under Amended Credit Agreement 10.00%
Amount of Loan Cap under Amended Credit Agreement $ 50,000,000
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Stock-Based Compensation Expense in Selling and Administrative Expenses (Detail) (USD $)
In Thousands, unless otherwise specified		 3 Months Ended 9 Months Ended
Jan. 31, 2015
 Jan. 25, 2014
 Jan. 31, 2015
 Jan. 25, 2014
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense $ 3,452 $ 2,466 $ 16,723 $ 8,147
Selling and Administrative Expenses | Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense 248 390 799 1,683
Selling and Administrative Expenses | Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense 2,990 1,694 13,594 7,688
Selling and Administrative Expenses | Stock Options
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense $ 214 $ 382 $ 2,330 $ (1,224)
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Pension and Other Postretirement Benefit Plans - Additional Information (Detail) (USD $)
In Thousands, unless otherwise specified		 3 Months Ended 9 Months Ended
Jan. 31, 2015
Employee
 Aug. 02, 2014
 Jan. 25, 2014
 Jan. 31, 2015
Employee
 Jan. 25, 2014
Pension and Other Postretirement Benefit Plans [Line Items]
Pension expense $ 7,914 $ 582 $ 9,299 $ 1,913
Increase in pension liability 15,747 5,498
Increase (decrease) in other comprehensive income, before tax 15,747 (7,619)
Pension plan, expected termination period 18 months
Pension plan, expected termination period 24 months
Number of terminated vested participants elected to receive lump sum payments 735
Lump sum payments made to plan participants 15,190
Number of remaining active and terminated vested participants elected to receive lump sum payments 2,300
Company contributions, employee benefit expenses 3,574 3,848 12,049 12,384
Company contributions for postretirement plan 38 38 113 113
Selling and Administrative Expenses
Pension and Other Postretirement Benefit Plans [Line Items]
Pension plan settlement charge $ 7,271
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Microsoft Investment - Additional Information (Detail) (USD $)
In Thousands, except Share data, unless otherwise specified		 9 Months Ended 0 Months Ended
Jan. 31, 2015
 Dec. 03, 2014
 May 03, 2014
 Jan. 25, 2014
 Apr. 27, 2012
Subsidiary, Sale of Stock [Line Items]
Aggregate purchase price paid in cash $ 76,175
Common stock, par value $ 0.001 $ 0.001 $ 0.001
Settlement of Microsoft commercial liability 197,316
Microsoft | Commitment
Subsidiary, Sale of Stock [Line Items]
Advance payments 60,000
Microsoft | Other Commitment
Subsidiary, Sale of Stock [Line Items]
Advance payments 25,000
B&N Education, LLC
Subsidiary, Sale of Stock [Line Items]
Aggregate purchase price 124,850
Percentage of business contingent payment agreement 22.70%
Business contingent payment agreement, Description the parties entered into a Digital Business Contingent Payment Agreement pursuant to which Microsoft is entitled to receive 22.7% of the proceeds from, among other events or transactions, (1) any future dividends or other distributions received from Barnes & Noble’s NOOK digital business at any time until the date that is three years from the closing, subject to a one year extension under certain circumstances, and (2) the sale of Barnes & Noble’s NOOK digital business at any time until the date that is three years from the closing, subject to a one year extension under certain circumstances.
B&N Education, LLC | Common Stock
Subsidiary, Sale of Stock [Line Items]
Aggregate purchase price, paid by shares 2,737,290 2,737,290
Common stock, par value $ 0.001
B&N Education, LLC | Series A Preferred
Subsidiary, Sale of Stock [Line Items]
Preferred stock issued, aggregate purchase price 300,000
Aggregate purchase price paid in cash 62,425
B&N Education, LLC | Morrison | Series A Preferred
Subsidiary, Sale of Stock [Line Items]
Preferred stock issued 300,000
Preferred stock issued, aggregate purchase price $ 300,000
B&N Education, LLC | Microsoft
Subsidiary, Sale of Stock [Line Items]
Percentage of common membership interest 17.60%
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Pearson - Additional Information (Detail) (USD $)
In Thousands, except Share data, unless otherwise specified		 9 Months Ended 0 Months Ended
Jan. 31, 2015
 Dec. 22, 2014
 May 03, 2014
 Jan. 25, 2014
 Jan. 22, 2013
Schedule Of Activities And Transactions Associated With Related Cost [Line Items]
Common stock, par value $ 0.001 $ 0.001 $ 0.001
Pearson Plc
Schedule Of Activities And Transactions Associated With Related Cost [Line Items]
Aggregate purchase price paid in cash $ 89,500
Percentage of common membership interest 5.00% 5.00%
Percentage of common membership interest owned by Pearson plc 78.20%
Preferred membership Interest 16.80%
Warrants purchase 5.00%
Fair value of warrants 1,700
Pearson Plc | Common Stock
Schedule Of Activities And Transactions Associated With Related Cost [Line Items]
Aggregate purchase price, paid by shares 602,927
Common stock, par value $ 0.001
Pearson Plc | Series B Preferred
Schedule Of Activities And Transactions Associated With Related Cost [Line Items]
Aggregate purchase price paid in cash $ 13,750
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Samsung Commercial Agreement - Additional Information (Detail) (Samsung Commercial Agreement)
 0 Months Ended
Jun. 04, 2014
Product
Samsung Commercial Agreement
Long-term Purchase Commitment [Line Items]
Minimum purchase commitment 1,000,000
Purchase commitment period 12 months
Purchase commitment period extension 3 months
Agreement term 2 years
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Series J Preferred Stock - Additional Information (Detail) (Private Placement, USD $)
In Thousands, except Share data, unless otherwise specified		 0 Months Ended
Aug. 18, 2011
 Apr. 08, 2014
 Aug. 29, 2011
Preferred Stock [Line Items]
Ownership percentage of initial investment 10.00%
Series J Preferred Stock
Preferred Stock [Line Items]
Preferred Stock, shares issued 204,000
Preferred Stock, par value $ 0.001
Aggregate purchase price of Preferred Stock $ 204,000
Preferred Stock, convertible percentage of common stock outstanding 16.60%
Preferred Stock, initial conversion price $ 17
Preferred Stock, initial dividend rate 7.75%
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Shareholders' Equity - Additional Information (Detail) (USD $)
In Thousands, except Share data, unless otherwise specified		 Jan. 31, 2015
 May 03, 2014
 Jan. 25, 2014
 May 15, 2007
Class of Stock [Line Items]
Remaining authorized repurchase amount $ 2,471
Treasury stock, shares 34,580,000 34,364,000 34,295,000
Treasury stock, at cost 1,073,424 1,069,109 1,067,641
Maximum
Class of Stock [Line Items]
Number of shares authorized to be repurchase 400,000
Stock Repurchase Program
Class of Stock [Line Items]
Treasury stock, shares 34,580,019
Treasury stock, at cost $ 1,073,424
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Legal Proceedings - Additional Information (Detail) (USD $)
In Thousands, unless otherwise specified		 0 Months Ended 9 Months Ended 0 Months Ended
Jul. 24, 2012
LegalMatter
 Jun. 14, 2013
LegalMatter
 Jan. 31, 2015
 Aug. 27, 2012
LegalMatter
 Apr. 17, 2012
LegalMatter
 Aug. 05, 2011
LegalMatter
 Apr. 23, 2013
LegalMatter
 Nov. 27, 2013
LegalMatter
 Jan. 25, 2013
LegalMatter
Technology Properties Limited
Loss Contingencies [Line Items]
Number of putative shareholder derivative complaints filed 1
Legal Claim 1
Loss Contingencies [Line Items]
Number of putative shareholder derivative complaints filed 1
Damages awarded $ 1,330
Commonwealth Scientific and Industrial Research Organisation
Loss Contingencies [Line Items]
Number of putative shareholder derivative complaints filed 1
Kevin Khoa Nguyen
Loss Contingencies [Line Items]
Number of putative shareholder derivative complaints filed 1
Lina
Loss Contingencies [Line Items]
Number of putative shareholder derivative complaints filed 1
Jones
Loss Contingencies [Line Items]
Number of putative shareholder derivative complaints filed 1
Carag
Loss Contingencies [Line Items]
Number of putative shareholder derivative complaints filed 1
Trimmer
Loss Contingencies [Line Items]
Number of putative shareholder derivative complaints filed 1
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