Barnes & Noble Education (BNED) Q2 2026 earnings summary

Executive summary

• Revenue for the 13 weeks ended November 1, 2025, increased 7.0% year-over-year to $644.4 million, driven by growth in BNC First Day® programs and offset by store closures.

• For the 26 weeks ended November 1, 2025, revenue rose 7.7% to $932.6 million, with net income of $6.7 million compared to a net loss of $60.8 million in the prior year.

• Net income for the quarter was $25.0 million, down from $43.2 million in the prior year, while adjusted EBITDA decreased 12.4% to $49.8 million.

• Adjusted EBITDA for the first half increased to $38.3 million from $33.9 million year-over-year.

• BNC First Day program revenue surged 29.0% year-over-year, with enrollment up 22.2%.

Financial highlights

• Gross profit for the quarter was $129.8 million (20.1% of sales), up 1.0% year-over-year, but gross margin declined due to higher markdowns and inventory reserves.

• Operating income for the quarter was $40.8 million (6.3% of sales), down from $47.1 million (7.8% of sales) in the prior year.

• Adjusted net income for the quarter was $26.4 million, and adjusted EBITDA was $49.8 million.

• Net working capital improved to $217.8 million from $165.8 million last year.

• Adjusted Free Cash Flow for the first half was $(15.4) million, a significant improvement from $(110.9) million in the prior year.

Outlook and guidance

• Fiscal 2026 Adjusted EBITDA is expected in the range of $65–$75 million.

• Management expects continued growth in BNC First Day® programs and ongoing store optimization to drive future profitability.

• Expects a material reduction in interest costs and approximately $20 million in capital expenditures.

• Fiscal 2027 targets Adjusted EBITDA growth of 15–20% or more.

• The company believes current liquidity, cash from operations, and access to credit will be sufficient for the next twelve months and beyond.