Shares of Barnes & Noble Education (BNED) were launched more than 36% higher at Tuesday’s open after the company released preliminary results for the fiscal year ended May 3 and for the first six months of fiscal year 2026 following an internal investigation to address accounting errors pertaining to digital sales.
The updated, unaudited results indicate that the bookseller will swing to a profit in the first six months of the current fiscal year, driven by increased sales, along with an improved balance sheet.
The accounting errors were the result of incorrect manual journal entries that improperly reduced cost of sales for fiscal years ended April 2024 and May 2025. Any preliminary impact of cost of sales and related items is reflected in the preliminary results.
For FY25, Barnes & Noble (BNED) expects sales to increase by 2.6% to $1.6B, and comparable store sales to increase by 7.5% from a year earlier. Revenue from the company’s Full Day program is expected to increase by 25.3% on strong institutional adoption.
Net loss is expected to narrow to a range between $62M to $68M from a loss of $72M to $78M a year earlier, including a $55.2M non-cash loss related to the extinguishment of debt. Adjusted EBITDA is expected to be between $55M and $63M, up from $34M to $40M in the previous fiscal year.
For the first six months of fiscal year 2026, Barnes & Noble (BNED), revenue is expected to increase 7.8% to $933.0M while net income is expected to be between $3.0M to $8.0M, a sizable improvement versus a loss of $59M to $65M during the first six months of the prior fiscal year thanks to comparable store sales growth and continued cost management.
Adjusted EBITDA for the first six months of FY26 is expected to be in the range of $32M to $42M, up from $30M to $36M in the first six months of FY25.
The company is also cutting its debt expectations for both FY26 and the first six months of FY26 by 47% and 33%, respectively.
For FY26, the company sees adjusted EBITDA between $65M and $75M with 15% to 20% growth anticipated in FY27.
The upbeat outlook catapulted shares through resistance at the 100-day moving average for the first time since July.