Barnes & Noble on Thursday announced that it is contemplating a spinoff of its Nook business.
"We see substantial value in what we've built with our Nook business in only two years, and we believe it's the right time to investigate our options to unlock that value," CEO William Lynch said in a statement. "In Nook, we've established one of the world's best retail platforms for the sale of digital copyright content. We have a large and growing installed base of millions of satisfied customers buying digital content from us, and we have a Nook business that's growing rapidly year-over-year and should be approximately $1.5 billion in comparable sales this fiscal year."
That growth will likely "continue to scale rapidly for the foreseeable future," Lynch said.
But while Barnes & Noble touted strong holiday sales for Nook products, it noted that sales of the Nook Tablet (slideshow below) and Nook Simple Touch fell short of expectations. Nine-week holiday retail sales were up 2.5 percent from last year to $1.2 billion and online sales increased 43 percent to $327 million.
The company also cut its forecast for fiscal 2012 revenue down to $7 billion.
Barnes & Noble said separating the Nook business is not a done deal, and it doesn't have a timeframe for when a decision will be reached. International expansion of the brand is also possible, and the company said that it's discussing its options with various publishers, retailers, and tech companies from around the world.
The retailer unveiled its $249 Nook Tablet in November, around the same time that rival Amazon started selling its $199 Kindle Fire tablet. Amazon has not released exact sales data for the Fire, but said recently that it sold more than 4 million Kindle devices during December.