IMMERSION CORP
For the period ended Oct 31, 2024. Filed Dec 16, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Oct 31, 2024 · Filed Dec 16, 2024
IMMR$6.79+1.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-06-30; filed 2024-08-19.
0001213900-24-070789
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2024-10-31; filed 2024-12-16.
0001213900-24-109054
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 119 previous paragraphs and 121 current paragraphs.
64 unchanged; 48 reworded; 8 added; 6 removed; 1 previous and 1 current paragraphs rearranged.
Tables are not compared: 6 previous and 6 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (8)
Current report
In order to more closely align with Barnes &Noble Education’s fiscal year end, on September 27, 2024, our Board of Directors (the “Board”) approved a change of our fiscal year from the period beginning on January 1 and ending on December 31 to the period beginning on May 1 and ending on April 30. As a result of the change in fiscal year end, we filed a Transition Report on Form 10-QT for the transition period from January 1, 2024, through April 30, 2024, on November 8, 2024. The change in quarterly reporting from the old to the new fiscal year resulted in theone month period ended July 31, 2024 not being covered by a separate report on Form 10-Q. As this period is not covered in the transition report, it is included in this first initial report on Form 10-Q for the newly adopted fiscal year. The financial results for the month ended July 31, 2024, did not have a significant impact on our financial position and results of operation.
Current report
Our fiscal year begins on May 1 and ends on April 30. Our new fiscal quarters end on July 31, October 31, January 31 and April 30. Therefore, the financial results of certain fiscal quarters may not be comparable to the financial results of prior fiscal quarters. References throughout this Quarterly Report on Form 10-Q to fiscal 2025 with respect to Immersion refer to the fiscal year ending April 30, 2025.
Current report
The financial information presented in this Quarterly Report on Form 10-Q includes the financial information of Barnes & Noble Education for the 13 weeks and 26 weeks ended October 26, 2024.
Current report
We did not recast the condensed consolidated financial statements for the three and six months ended October 31, 2023, because the financial reporting processes in place at that time included certain procedures that were completed only on a quarterly basis. Consequently, to recast this period would have been impractical and would not have been cost-justified. As a result, the condensed consolidated financial statements for the three and six months ended June 30, 2023, are presented as the most nearly comparable quarter of the earlier year.
Current report
BNC First Day Affordable Textbook Programs
Current report
Depreciation and amortization
Current report
Barnes & Noble Education depreciation and amortization expense consisted primarily of depreciation and amortization expense for property and equipment and intangible assets.
Current report
On November 8, 2024, our Board declared a special cash dividend of $0.245 per share on the Company’s outstanding common stock payable, subject to any prior revocation, on January 24, 2025 to stockholders of record on January 10, 2025.
Removed paragraphs (6)
Previous report
Royalty and license revenue
Previous report
Selling and administrative expenses increased $33.7 millionin the six months ended June 30, 2024 as compared to the same period in 2023 primarily due to a $26.5 million increase in legal costs and a $7.6 million increase in compensation, benefits and other personnel related costs.
Previous report
BNC First Day Equitable and Inclusive Access Programs
Previous report
***Relationship with Fanatics and Lids ***
Previous report
In December 2020, Barnes & Noble Education entered into the F/L Relationship. Fanatics and Lids, acting on its behalf as its service providers, provide unparalleled product assortment, e-commerce capabilities and powerful digital marketing tools to drive increased value for customers and accelerate growth of our logo general merchandise business. Fanatics operates as Barnes & Noble Education's service provider, including processing consumer personal information on it behalf, using their cutting-edge e-commerce and technology expertise to offer our campus store websites expanded product selection, a world-class online and mobile experience, and a progressive direct-to-consumer platform. Coupled with Lids, the leading standalone brick and mortar retailer focused exclusively on licensed fan and alumni products, Barnes & Noble Education campus stores have improved access to trend and sales performance data on licensees, product styles, and design treatments.******
Previous report
Barnes & Noble Education maintains its relationships with campus partners and remain responsible for staffing and managing the day-to-day operations of our campus bookstores. Barnes & Noble Education also work closely with its campus partners to ensure that each campus store maintains unique aspects of in-store merchandising, including localized product assortments and specific styles and designs that reflect each campus’s brand. Barnes & Noble Education leverage Fanatics’ e-commerce technology and expertise for the operational management of the emblematic merchandise and gift sections of our campus store websites. Lids manages in-store assortment planning and merchandising of emblematic apparel, headwear, and gift products for its partner campus stores, and Lids owns the inventory it manages, relieving it of the obligation to finance inventory purchases from working capital.
Reworded paragraphs (48)
Previous wording
Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Actual results could differ materially from those projected in the forward-looking statements, therefore we caution you not to place undue reliance on these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the risk factors contained under Part I, Item 1 A, “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the Securities and Exchange Commission the (“SEC”) on March 11, 2024 and Part I, Item 1 A, “Risk Factors” in Barnes & Noble Educations’ Annual Report on Form 10-K for the fiscal year ended April 27, 2024 filed with the SEC on July 1, 2024.
Current wording
Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Actual results could differ materially from those projected in the forward-looking statements, therefore we caution you not to place undue reliance on these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the risk factors contained under Part I, Item 1 A, “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the Securities and Exchange Commission the (“SEC”) on March 11, 2024, Part I, Item 1 A, “Risk Factors” in Barnes & Noble Education’s Annual Report on Form 10-K for the fiscal year ended April 27, 2024 filed with the SEC on July 1, 2024 and in Part II, Item 1 A, “Risk Factors” of this Quarterly Report on Form 10-Q.
Previous wording
Immersion Corporation (“Immersion”) was incorporated in 1993 in California and reincorporated in Delaware in 1999. In this Management’s Discussion and Analysis of Financial Condition and Results of Operations the terms the“Company,”“us,” “we,” or “our” refer to Immersion and its consolidated subsidiaries. Immersion generates license and royalty revenues from a wide range of intellectual property (“IP”) that more fully engage users’ sense of touch when operating digital devices. We focus on the following target application areas: mobile devices, wearables, consumer, mobile entertainment and other content; console gaming; automotive; medical; and commercial.
Current wording
Immersion Corporation (“Immersion”) was incorporated in 1993 in California and reincorporated in Delaware in 1999. In this Management’s Discussion and Analysis of Financial Condition and Results of Operations the terms the “Company,” “us,” “we,” or “our” refer to Immersion and its consolidated subsidiaries. Immersion generates license and royalty revenues from a wide range of IP that more fully engage users’ sense of touch when operating digital devices. We focus on the following target application areas: mobile devices, wearables, consumer, mobile entertainment and other content; console gaming; automotive; medical; and commercial.
Previous wording
On June 10, 2024, we acquired a controlling interest in Barnes & Noble Education, Inc., a Delaware corporation (“Barnes & Noble Education”), refer to Note 2. Business Combination for more information. The financial results of Barnes & Noble Education have been included in our condensed consolidated financial statements from the acquisition date of June 10, 2024.
Current wording
On June 10, 2024, we acquired a controlling interest in Barnes & Noble Education, Inc., a Delaware corporation (“Barnes & Noble Education” or “BNED”), refer to Note 2. Business Combination for more information. The financial results of Barnes & Noble Education have been included in our condensed consolidated financial statements from the acquisition date of June 10, 2024.
Previous wording
Immersion generates license and royalty revenues from a wide range of intellectual property (“IP”) that more fully engage users’ sense of touch when operating digital devices. We focus on the following target application areas: mobile devices, wearables, consumer, mobile entertainment and other content; console gaming; automotive; medical; and commercial.
Current wording
Immersion generates license and royalty revenues from a wide range of IP that more fully engage users’ sense of touch when operating digital devices. We focus on the following target application areas: mobile devices, wearables, consumer, mobile entertainment and other content; console gaming; automotive; medical; and commercial.
Previous wording
A summary of our results of operation for the three and six months ended June 30, 2024, and 2023 is as follows (in thousands):
Current wording
A summary of our results of operation for the month ended July 31, 2024, and the three and six months ended October 31, 2024, and June 30, 2023 is as follows (in thousands, except for percentages):
Previous wording
Fixed fee license revenue increased by $47.5 million in the second quarter of 2024 compared to the same period in 2023 primarily due to an increase in mobility license revenue we recognized in the second quarter of 2024 following the new license agreements we entered into in the first half of 2024.
Current wording
Fixed fee license revenue increased by $9.4 million in the three months ended October 31, 2024, compared to the three months ended June 30,2023, primarily due to $9.7 million increase in mobility license revenue following the new license agreements we entered into in the first half of fiscal 2025.
Previous wording
Per-unit royalty revenue decreased by $2.9 million, or 25%, in thefirstsix months of 2024 compared to the same period in 2023, primarily due to a $1.8 million decrease in royalties from gaming licensees and a $1.8 million decrease in royalties from mobility licensees.
Current wording
Per-unit royalty revenue decreased by $2.3 million, or 40%, in the three months ended October 31, 2024 compared to the three months ended June 30,2023, primarily due to a$2.4 million decrease in royalties from mobility licensees.
Previous wording
Geographically, revenues generated in Asia, North America and Europe for the three months ended June 30, 2024 represented 98%,2%, and 0%, respectively, of our total revenue as compared to 14%,83%, and 3%, respectively, for the three months ended June 30, 2023.
Current wording
Geographically, revenues generated in Asia, North America and Europe for the three months ended October 31, 2024 represented 90%,5%, and 5%, respectively, of our total revenue as compared to 14%,83%, and 3%, respectively, for the three months ended June 30, 2023.
Previous wording
Fixed fee license revenue increased by $85.1 million in the firstsix months of 2024 compared to the same period in 2023 primarily due to a $47.6 million increase in mobility license revenue and $37.5 million increase in gaming license revenue primarily resulting from new license agreements we entered into in the first half of 2024.
Current wording
Fixed fee license revenue increased by $53.6 million in the firstsix months of fiscal 2025 compared to the six months ended June 30,2023, primarily due to a $53.8 million increase in mobility license revenue following the new license agreements we entered into in the first half of fiscal 2025.
Previous wording
Per-unit royalty revenue decreased by $2.1 million, or 37%, in the second quarter of 2024 compared to the same period in 2023, primarily due to a$1.6 million decrease in royalties from mobility licensees, a $0.9 million decrease in royalties from gaming licensees and a $0.5 million decrease in royalties from automotive licensees.
Current wording
Per-unit royalty revenue decreased by $5.1 million, or 44%, in the six months ended October 31, 2024 compared to the six months ended June 30,2023, primarily due toa $2.9 million decrease in royalties from mobility licensees, a $1.4 million decrease in royalties from gaming licensees and a $0.9 million decrease in royalties from other licensees.
Previous wording
Geographically, revenues generated in Asia, North America and Europe for the six months ended June 30, 2024 represented 58%,41%, and 1%, respectively, of our total revenue as compared to 83%,13%, and 4%, respectively, for the six months ended June 30, 2023.
Current wording
Geographically, revenues generated in Asia, North America and Europe for the six months ended October 31, 2024 represented 96%,3%, and 1%, respectively, of our total revenue as compared to 96%,1%, and 3%, respectively, for the six months ended June 30, 2023.
Previous wording
A summary of operating expenses for thethree and six months ended June 30, 2024, and 2023 is as follows (in thousands, except for percentages):
Current wording
A summary of operating expenses for the month ended July 31, 2024, and thethree and six months ended October 31, 2024, and June 30, 2023, is as follows (in thousands, except for percentages):
Previous wording
Selling and administrative expenses increased $10.3 millionin thethree months ended June 30, 2024 as compared to the same period in 2023 primarily due to a $5.7 million increase in legal costs and a $4.9 million increase in compensation, benefits and other personnel related costs.
Current wording
Selling and administrative expenses increased $0.3 millionin thethree months ended October 31, 2024 as compared to the three months ended June 30,2023 primarily due toa $0.8 million increase in compensation, benefits and other personnel related costs partially offset by a $0.5 million decrease in legal costs. The increase in compensation, benefits and other personnel related costs is largely attributable to higher stock-based compensation expense resulting from new equity grants partially offset by a decrease in variable compensation.
Previous wording
The increase in compensation, benefits and other personnel related costs in the three and six months ended June 30, 2024 compared to the same period in 2023 were largely driven by increases in variable compensation. The increase in legal costs in the three and six months ended June 30, 2024 compared to the same period in 2023 was due to an increase from legal costs related to the new license agreements and Barnes & Noble Education Transactions.
Current wording
Selling and administrative expenses increased $9.9 millionin the six months ended October 31, 2024 as compared to the six months ended June 30,2023 primarily due to a $5.1 million increase in legal costs and a $4.9 million increase in compensation, benefits and other personnel related costs. The increase in legal costswas due to an increase from legal costs related to the new license agreements and Barnes & Noble Education Transactions. The increase in compensation, benefits and other personnel related costs were largely driven by increases in variable compensation and higher stock-based compensation.
Previous wording
Barnes & Noble Education isone of the largest contract operators of physical and virtual bookstores for college and university campuses and K-12 institutions across the United States. Barnes & Noble Education is alsoone of the largest textbook wholesalers, inventory management hardware and software providers. Barnes & Noble Education operates 1,163 physical, virtual, and custom bookstores and services more than 5.8 million students, delivering essential educational content, tools and general merchandise within a dynamic omnichannel retail environment.
Current wording
Barnes & Noble Education isone of the largest contract operators of physical and virtual bookstores for college and university campuses and K-12 institutions across the United States. Barnes & Noble Education is also a textbook wholesaler, and inventory bookstore management hardware and software provider. Barnes & Noble Education operates 1,162 physical and virtual bookstores and serves more than 5.7 million students, delivering essential educational content and general merchandise within a dynamic omnichannel retail environment.
Previous wording
The strengths of Barnes & Noble Education's business include its ability to compete by developing new products and solutions to meet market needs, its large operating footprint with direct access to students and faculty, its well-established, deep relationships with academic partners and stable, long-term contracts and its well-recognized brands. Barnes & Noble Education provides product and service offerings designed to address the most pressing issues in higher education, including equitable access, enhanced convenience and improved affordability through innovative course material delivery models designed to drive improved student experiences and outcomes. Barnes & Noble Education offers itsBNC First Day®equitable and inclusive access programs, consisting ofFirst Day CompleteandFirst Day, which provide faculty required course materials on or before the first day of class at below market rates, as compared to the total retail price for the same course materials if purchased separately (a la carte), and students are billed the below market rate directly by the institution as a course charge or included in tuition.
Current wording
The strengths of Barnes & Noble Education's business include its ability to compete by developing new products and solutions to meet market needs, its large operating footprint with direct access to students and faculty, its well-established, deep relationships with academic partners and stable, long-term contracts and its well-recognized brands. Barnes & Noble Education provides product and service offerings designed to address the most pressing issues in higher education, including equitable access, enhanced convenience and improved affordability through innovative course material delivery models designed to drive improved student experiences and outcomes. Barnes & Noble Education offers its BNC First Day® affordable textbook programs, consisting of First Day Complete and First Day, which provide faculty required course materials to students on or before the first day of class at below market rates, as compared to the total retail price for the same course materials if purchased separately (a la carte), and students are billed the below market rate directly by the institution as a course charge or included in tuition. Barnes & Noble Education is moving quickly to accelerate its First Day Complete strategy. Many institutions adopted First Day Complete in Fiscal 2024, and Barnes & Noble Education plans to continue to scale the number of schools adopting First Day Complete in Fiscal 2025 and beyond. See BNC First Day® Affordable Textbook Access Programs below.
Previous wording
Barnes & Noble Education expects to continue to introduce scalable and advanced solutions focused largely on the student and customer experience, expand its e-commerce capabilities and accelerate such capabilities through its service providers, Fanatics Retail Group Fulfillment, LLC (“Fanatics”) and Fanatics Lids College, Inc. D/B/A “Lids” (“Lids”) (collectively referred to herein as the “F/L Relationship”), win new accounts, and expand its revenue opportunities through strategic relationships. Barnes & Noble Education expect gross comparable store general merchandise sales to increase over the long term, as its product assortments continue to emphasize and reflect changing consumer trends, and Barnes & Noble Education evolves its presentation concepts and merchandising of products in stores and online, which Barnes & Noble Education expects to be further enhanced and accelerated through the F/L Relationship. Fanatics and Lids, acting on Barnes & Noble Education's behalf as its service providers, provide unparalleled product assortment, e-commerce capabilities and powerful digital marketing tools to drive increased value for customers and accelerate growth of its logo general merchandise business.
Current wording
Barnes & Noble Education expects to continue to introduce scalable and advanced solutions focused largely on the student and customer experience, expand its e-commerce capabilities and accelerate such capabilities with its service providers, Fanatics Retail Group Fulfillment, LLC (“Fanatics”) and Fanatics Lids College, Inc. D/B/A “Lids” (“Lids”) (collectively referred to herein as the “F/L Relationship”), win new accounts, and expand its revenue opportunities through strategic relationships. Barnes & Noble Education expect gross comparable store general merchandise sales to increase over the long term, as its product assortments continue to emphasize and reflect changing consumer trends, and Barnes & Noble Education evolves its presentation concepts and merchandising of products in stores and online, which Barnes & Noble Education expects to be further enhanced and accelerated through the F/L Relationship. Fanatics and Lids, acting on Barnes & Noble Education's behalf as its service providers, provide unparalleled product assortment, e-commerce capabilities and powerful digital marketing tools to drive increased value for customers and accelerate growth of its logo general merchandise business.
Previous wording
TheBarnes & Noble brand (licensed from Barnes & Noble Education’s former parent) along with its subsidiary brands,BNCandMBS, are synonymous with innovation in bookselling and campus retailing, and are widely recognized and respected brands in the United States. Barnes & Noble Education’s large college footprint, reputation, and credibility in the marketplace not only support its marketing efforts to universities, students, and faculty, but are also important to its relationship with leading publishers who rely on Barnes & Noble Education asone of their primary distribution channels.
Current wording
The Barnes & Noble brand (licensed from Barnes & Noble Education’s former parent) along with its subsidiary brands, BNC and MBS, are synonymous with innovation in bookselling and campus retailing, and are widely recognized and respected brands in the United States. Barnes & Noble Education's large college footprint, reputation, and credibility in the marketplace not only support its marketing efforts to universities, students, and faculty, but are also important to its relationship with leading publishers who rely on Barnes & Noble Education asone of their primary distribution channels.
Previous wording
Barnes & Noble provides product and service offerings designed to address the most pressing issues in higher education, including equitable access, enhanced convenience and improved affordability through innovative course material delivery models designed to drive improved student experiences and outcomes. Barnes & Noble Education offer itsBNC First Day®equitable and inclusive access programs, consisting ofFirst Day CompleteandFirst Day, which provide faculty required course materials on or before the first day of class at below market rates, as compared to the total retail price for the same course materials if purchased separately (a la carte), and students are billed the below market rate directly by the institution as a course charge or included in tuition.******
Current wording
******Barnes & Noble Education provides product and service offerings designed to address the most pressing issues in higher education, including equitable access, enhanced convenience and improved affordability through innovative course material delivery models designed to drive improved student experiences and outcomes. Barnes & Noble Education offers its BNC First Day® affordable textbook access programs, consisting of First Day Complete and First Day, which provide faculty required course materials to students on or before the first day of class at below market rates, as compared to the total retail price for the same course materials if purchased separately (a la carte), and students are billed the below market rate directly by the institution as a course charge or included in tuition.
Previous wording
• First Day Complete is adopted by an institution and includes all or the majority of undergraduate classes (and on occasion graduate classes), providing students both physical and digital materials. TheFirst Day Complete model drives substantially greater unit sales and sell-through for the bookstore.
Current wording
• First Day Complete is adopted by an institution and includes all or the majority of undergraduate classes (and on occasion graduate classes), providing students with both physical and digital materials. In addition to providing numerous benefits to students, faculty and administrators, the First Day Complete model drives substantially greater unit sales and sell-through for the bookstore.
Previous wording
Offering course materials through Barnes & Noble Education's equitable and inclusive accessFirst Day CompleteandFirst Day models is an important strategic initiative to meet the market demands of substantially reduced pricing to students, as well as the opportunity to improve student outcomes, while, at the same time, increasing Barnes& Noble Education market share, revenue and relative gross profits of course material sales given the higher volumes of units sold in such models as compared to historical sales models that rely on individual student marketing and sales. These programs have allowed Barnes & Noble Education to reverse historical long-term trends in course materials revenue declines, which has been observed at those schools where such programs have been adopted and improve predictability of its future results. In 2024, the growth of theBNC First Day programs offset the declines in a la carte courseware sales and closed store sales. Barnes & Noble Education is moving quickly to accelerate itsFirst Day Complete strategy. Many institutions adoptedFirst Day Complete in Fiscal 2024, and Barnes & Noble plans to continue to scale the number of schools adoptingFirst Day Complete in 2025 and beyond.******
Current wording
Offering course materials through the BNC First Day® affordable textbook access programs, First Day Complete and First Day, is an important strategic initiative to meet the market demands of reduced pricing for students, as well as the opportunity to improve student outcomes, while, at the same time, increasing Barnes & Noble Education's market share, revenue and relative gross profits of course material sales given the higher volumes of units sold in such models as compared to historical sales models that rely on individual student marketing and sales. These affordable textbook access programs have allowed Barnes & Noble Education to reverse historical long-term trends in course materials revenue declines, which has been observed at those schools where such programs have been adopted. Barnes & Noble Education is moving quickly to accelerate its First Day Complete strategy. Many institutions have already adopted First Day Complete, and Barnes & Noble Education plans to continue to scale the number of schools adopting First Day Complete in fiscal 2025 and beyond.
Previous wording
Bares & Noble Education's business is highly seasonal. For example, its retail business is seasonal, particularly with respect to textbook sales and rentals, with the major portion of sales and operating profit realized during the fiscal quarters when college students generally purchase and rent textbooks for the upcoming semesters and lowest in the other fiscal quarters. Barnes & Noble Education's quarterly results also may fluctuate depending on the timing of the start of the various schools’ semesters, the revenue impact of accounting principles with respect to the recognition of revenue associated with its equitable and inclusive access programs, the ability to secure inventory on a timely basis.
Current wording
Barnes & Noble Education's business is highly seasonal, particularly with respect to textbook sales and rentals, with the major portion of sales and operating profit realized during the second and third fiscal quarters when college students generally purchase and rent textbooks for the upcoming semesters and lowest in the first and fourth fiscal quarters. Barnes & Noble Education's quarterly results also may fluctuate depending on the timing of the start of the various schools’ semesters, as well as shifts in our fiscal calendar dates. These shifts in timing may affect the comparability of our results across periods.
Previous wording
Given the growth of BNC First Day programs, the timing of cash collection from Barnes & Noble Education's school partners may shift to periods subsequent to when the revenue is recognized. When a school adopts our BNC First Day equitable and inclusive access offerings, cash collection from the school generally occurs after the institution's drop/add dates, which is later in the working capital cycle as compared to direct-to-student point-of-sale transactions where cash is generally collected during the point-of-sale transaction or within a few days from the credit card processor. As a higher percentage of Barnes & Noble Education's sales shift to BNC First Day equitable and inclusive access offerings, it is focused on efforts to better align the timing of its cash outflows to course material vendors and cash inflows from collections from schools. As the concentration of digital product sales increases, revenue will be recognized earlier during the academic term as digital textbook revenue is recognized when the customer accesses the digital content compared to: (i) the rental of physical textbooks where revenue is recognized over the rental period, and (ii) a la carte courseware sales where revenue is recognized when the customer takes physical possession of our products, which occurs either at the point of sale for products purchased at physical locations or upon receipt of our products by our customers for products ordered through our websites and virtual bookstores.
Current wording
Given the growth of BNC First Day® affordable textbook access programs, the timing of cash collection from the school partners may shift to periods subsequent to when the revenue is recognized. When a school adopts Barnes & Noble Education's BNC First Day® affordable textbook access offerings, cash collection from the school generally occurs after the institution's drop/add dates, which is later in the working capital cycle, particularly in the third quarter given the timing of the Spring Term and Barnes & Noble Education's quarterly reporting period, as compared to direct-to-student point-of-sale transactions where cash is generally collected during the point-of-sale transaction or within a few days from the credit card processor. As a higher percentage of Barnes & Noble Education's sales shift to BNC First Day® affordable textbook access offerings, Barnes & Noble Education is focused on efforts to better align the timing of its cash outflows to course material vendors and cash inflows from collections from schools. As the concentration of digital product sales increases, revenue will be recognized earlier during the academic term as digital textbook revenue is recognized when the customer accesses the digital content compared to: (i) the rental of physical textbooks where revenue is recognized over the rental period, and (ii) a la carte courseware sales where revenue is recognized when the customer takes physical possession of our products, which occurs either at the point of sale for products purchased at physical locations or upon receipt of products by Barnes & Noble Education customers for products ordered through its websites and virtual bookstores.
Previous wording
A summaryof Barnes & Noble Education results of operationfor the reporting period from June 10, 2024, to June 30, 2024, is as follows (in thousands):
Current wording
A summaryof Barnes & Noble 's Education’s s results of operationfor the reporting period for the month ended July 31, 2024, the three months ended October 31, 2024 and for the period from June 10, 2024, to October 31, 2024, is as follows (in thousands):
Previous wording
Barnes & Noble Education primarily derives its revenues from sale of course materials, which include new, used, rental and digital textbooks. Additionally, at college and university bookstores which Barnes & Noble Education operates, it sells general merchandise, including emblematic apparel and gifts, trade books, computer products, school and dorm supplies, convenience and café items and graduation products. Barnes & Noble Education's rental income is primarily derived from the rental of physical textbooks. Barnes & Noble Education also derives revenue from other sources, such as sales of inventory management, hardware and point-of-sale software, and other services.
Current wording
Barnes & Noble Education primarily derives its revenues from sale of course materials, which include new, used, rental and digital textbooks. Additionally, at college and university bookstores which Barnes & Noble Education operates, it sells general merchandise, including emblematic apparel and gifts, trade books, computer products, school and dorm supplies, convenience and café items and graduation products. Barnes & Noble Education's rental income is primarily derived from the rental of physical textbooks. Barnes & Noble Education also derives revenue from other sources, such as sales of bookstore management, hardware and point-of-sale software, and other services.
Previous wording
Total revenue was $47.0 million during the period from June 10, 2024, to June 30, 2024, primarily consisting of $45.1 million product and other sales and $1.9 million of rental sales.
Current wording
Total revenue was $602.1 million during the three months ended October 31, 2024, primarily consisting of$559.7 million product and other sales and $42.4 million of rental sales. Total revenue was $737.2 million during the period from June 10, 2024, to October 31, 2024, primarily consisting of $689.8 million product and other sales and $47.4 million of rental sales.
Previous wording
During the period of June 10, 2024, to June 30, 2024, Barnes & Noble Education recognized restructuring and other charges totaling $2.4 million, comprised primarily of $2.0 million of severance costs related to the departure of its Chief Executive Officer on June 11, 2024 and $0.4 million costs associated with legal and advisory professional services.
Current wording
During the period from June 10, 2024, to October 31, 2024, Barnes & Noble Education recognized restructuring and other charges (credits) totaling $5.1 million, comprised primarily of $2.1 million related to severance and other employee termination and benefit costs associated with elimination of various positions as part of cost reduction initiatives, $2.0 million of severance costs related to the departure of Barnes & Noble Education's Chief Executive Officer on June 11, 2024, a $1.9 million loss related to fixed assets disposal and $0.8 million costs associated with legal and advisory professional services restructuring and process improvements and other charges. These costs and expenses were partially offset by a $1.4 million expense reversal related to the termination of liabilities related to a frozen retirement benefit plan.
Previous wording
Interest and Other Income (loss), Interest Expenses and Income Taxes
Current wording
Interest and Other Income, Interest Expenses and Income Taxes
Previous wording
A summaryof consolidated interest and other Income (loss), interest expense and income taxes for the three and six months ended June 30, 2024 and 2023 are as follows (in thousands, except for percentages):
Current wording
A summaryof consolidated interest and other Income (loss), interest expense and income taxes for the month ended July 31, 2024 and thethree and six months ended October 31, 2024 and June 30, 2023 are as follows (in thousands, except for percentages):
Previous wording
Interest and Other Income (loss) - Interest and other income consists primarily of interest and dividend income from cash and cash equivalents and marketable debt and equity securities, short-term investments realized and unrealized gains (losses) on our marketable equity securities and derivative instruments and realized gains (losses) on our marketable debt securities.
Current wording
Interest and Other Income (loss) -Interest and other income consists primarily of interest and dividend income from cash and cash equivalents and marketable debt and equity securities, realized and unrealized gains (losses) on our marketable equity securities and derivative instruments and realized gains (losses) on our marketable debt securities.
Previous wording
Interest and other income (loss), net decreased $2.2 million during the three months ended June 30, 2024 compared to the same period in 2023, primarily due to a $2.7 million decrease in net gains from investments in marketable equity securities and derivative instruments and a $0.6 million increase in interest income.
Current wording
Interest and other income, net decreased $3.2 million during the three months ended October 31, 2024 compared to the three months ended June 30, 2023, primarily due to a $4.2 million decrease in net gains from investments in marketable equity securities and derivative instruments and a $0.5 million increase in interest income.
Previous wording
Interest and other income (loss), net decreased $0.6 million during the six months ended June 30, 2024, compared to the same period in 2023, primarily driven by a $1.8 million decrease in net gains from investments in marketable equity securities and derivative instruments and a $0.3 million increase in net foreign currency translation loss partially offset a $1.5 million increase in interest income.
Current wording
Interest and other income, net increased $0.4 million during the six months ended October 31, 2024, compared to the six months ended June 30, 2023, primarily driven bya $0.9 million increase in interest income partially offset bya $0.6 million decrease in net gains from investments in marketable equity securities and derivative instruments.
Previous wording
Provision for income taxes for thethree andsix months ended June 30, 2024 resulted primarily from estimated domestic and foreign taxes included in the calculation of the effective tax rate. Provision for income taxes for the three months ended June 30, 2023 resulted primarily from estimated foreign taxes included in the calculation of the effective tax rate. We maintain no valuation allowance against our U.S. federal deferred tax assets and maintain al valuation allowance against certain our U.S. state and Canadian federal deferred tax assets. The change in the estimated effective tax rate was mainly driven by higher U.S. taxable income which was a result of higher U.S. passive income.
Current wording
Provision for income taxes for the three and six months ended October 31, 2024 resulted primarily from estimated domestic and foreign taxes included in the calculation of the effective tax rate. We maintain no valuation allowance against our U.S. federal deferred tax assets and maintain a valuation allowance against certain our U.S. state and Canadian federal deferred tax assets. The change in the estimated effective tax rate was mainly driven by higher U.S. taxable income which was a result of higher U.S. passive income.
Previous wording
We also maintain liabilities for uncertain tax positions. As of June 30, 2024, we had unrecognized tax benefits under ASC 740 Income Taxes of approximately $7.6 million, of which $4.9 million could be payable in cash. In addition, interest and penalty $0.3 million could also be payable in cash in relation to the unrecognized tax benefits. The total amount of unrecognized tax benefits that would affect our effective tax rate, if recognized, is $4.9 million. We account for interest and penalties related to uncertain tax positions as a component of income tax provision. We do not expect to have any significant changes to unrecognized tax benefits during the next twelve months.
Current wording
We also maintain liabilities for uncertain tax positions. As of October 31, 2024, we had unrecognized tax benefits under ASC 740 Income Taxes of approximately $7.6 million, all of the $7.6 million could be payable in cash. In addition, interest and penalty of $0.2 million could also be payable in cash in relation to unrecognized tax benefits. The total amount of unrecognized tax benefits that would affect our effective tax rate, if recognized, is $7.6 million. We account for interest and penalties related to uncertain tax positions as a component of income tax provision. We do not expect to have any significant changes to unrecognized tax benefits during the next twelve months.
Previous wording
Barnes & Noble Education recorded an income tax provision of $0.1 million on pre-tax loss of $76.3 million during the period of June 10, 2024, to June 30, 2024, which represented an effective income tax rate of (0.1)%.
Current wording
Barnes & Noble Education recorded an income tax provision of $1.3 million on pre-tax loss of $48.5 million during the period of May 1 st,2024 to October 31, 2024, which represented an effective income tax rate of (2.6)%.
Previous wording
In assessing the realizability of the deferred tax assets, management considered whether it is more likely than not that some or all of the deferred tax assets would be realized. As of June 30, 2024, Barnes & Noble Education determined that it was more likely than not that Barnes & Noble Education would not realize all deferred tax assets and its tax rate for the current fiscal year reflects this determination. Barnes & Noble Education will continue to evaluate this position.
Current wording
In assessing the realizability of the deferred tax assets, management considered whether it is more likely than not that some or all of the deferred tax assets would be realized. As of October 31, 2024, Barnes & Noble Education determined that it was more likely than not that it would not realize all deferred tax assets and its tax rate for the current fiscal year reflects this determination. Barnes & Noble Education will continue to evaluate this position.
Previous wording
Our cash equivalents, investments - current and investments - noncurrent consist primarily of money-market funds, investments in marketable equity and debt securities (including mutual funds), investments in U.S. treasury securities and certificates of deposit. All marketable securities are stated at market value. Realized gains and losses on marketable equity securities and marketable debt securities are recorded in Other income (expense), net on the Condensed Consolidated Statements of Operations and Comprehensive Income. Unrealized gains and losses on marketable equity securities (including mutual funds) are reported as Other income (expense), net on our Condensed Consolidated Statement of Operations and Comprehensive Income. Unrealized gains and losses on marketable debt securities reported as a component of Accumulated other comprehensive income on our Condensed Consolidated Balance Sheets. Certificates of deposit are reported as Investment - current or Investment -noncurrent based on their remaining maturity days. Interest income from certificates of deposit are reported as Interest and other income (loss), neton the Condensed Consolidated Statement of Operations and Comprehensive Income.
Current wording
Our cash equivalents, investments - current and investments - noncurrent consist primarily of money-market funds, investments in marketable equity and debt securities and investments in U.S. treasury securities. All marketable securities are stated at fair value. Realized gains and losses on marketable equity securities and marketable debt securities are recorded in Other income (expense), net on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). Unrealized gains and losses on marketable equity securities are reported as Other income (expense), net on our Condensed Consolidated Statement of Operations and Comprehensive Income (Loss). Unrealized gains and losses on marketable debt securities reported as a component of Accumulated other comprehensive income on our Condensed Consolidated Balance Sheets.
Previous wording
Cash, cash equivalents and investments-current -As of June 30, 2024, our cash, cash equivalents, and investments- current totaled $133.4 million, a $27.0 million decrease from $160.4 million on December 31, 2023. In addition, as of June 30, 2024, we had restricted cash of $14.6 million.
Current wording
Cash, cash equivalents and investments-current -As of October 31, 2024, our cash, cash equivalents, and investments- current totaled $159.3 million, a $19.0 million decrease from $178.4 million on April 30, 2024. In addition, as of October 31, 2024, we had restricted cash of $17.3 million.
Previous wording
A summary of select cash flow information for the three months ended June 30, 2024 and 2023 are as follows (in thousands):
Current wording
A summary of select cash flow information for the six months ended October 31, 2024 and June 30,2023 are as follows (in thousands):
Previous wording
Net cash used in operating activities was $56.0 million in the six months ended June 30, 2024, a $64.8 million decrease compared to the same period in 2023. This cash decrease was primarily attributable to an $94.0 million decreases from changes in operating assets and liabilities partially offset by $24.3 million increase from changes in net income and a $4.9 million increase from non-cash items.
Current wording
Net cash used in operating activities was $64.0 million in the six months ended October 31, 2024, a $72.7 million decrease compared to the six months ended June 30,2023. This cash decrease was primarily attributable to a $145.1 million decrease from changes in operating assets and liabilities partially offset by $52.8 million increase from changes in net income and a $19.6 million increase from non-cash items.
Showing the first 40 of 48 pairs. Open the source sections for the rest.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
On August 12, 2024, our Board declared a quarterly dividend in the amount of $0.045 per share, which was paid on October 18, 2024 to stockholders of record on October 4, 2024.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
On August 12, 2024, our Board declared a quarterly dividend in the amount of $0.045 per share, payable on October 18, 2024, tostockholders of record on October 4, 2024.