Is It Time for Barnes & Noble, Inc. (BKS) to Throw In the Towel?

Unfortunately, this quarter’s core comparable retail sales — one of the few bright notes last quarter — offered little reason for optimism this time around, falling 5.8% to remain essentially flat for the year.

It should come as no surprise, then, that Barnes & Noble’s press release says the company has decided to (at least partially) throw in the towel, with plans to “significantly reduce losses in the Nook segment by limiting risks associated with manufacturing.” Namely, that means B&N will partner in a co-branding effort with yet-to-be-announced “third party manufacturers of consumer electronics products.”

In addition, Barnes & Noble will continue building its digital catalog by adding books and launching new Nook apps.

Foolish takeaway
In the end, that’ll certainly go a long way toward stopping the bleeding, but that doesn’t change the fact that the company’s core comparable retail sales are also falling at an increasing rate.

Of course, the company does have some time to right its wrongs, especially considering it ended its fiscal year with just over $160 million in the bank, and having borrowed just $77 million under its $1 billion revolving credit facility.

From an investing standpoint, however, it’s not exactly an appealing idea to buy shares in a company with a deteriorating core business simply because it can rack up additional debt to hold it over. In order for Barnes & Noble, Inc. (NYSE:BKS) to prove its worth to shareholders, then, it’ll need to show significant tangible progress toward sustained profitability.

In the meantime, there are much better places to put your hard-earned investing dollars to work.

The article Is It Time for Barnes & Noble to Throw In the Towel? originally appeared on Fool.com and is written by Steve Symington.

Fool contributor Steve Symington owns shares of Apple. The Motley Fool recommends Amazon.com and Apple. The Motley Fool owns shares of Amazon.com and Apple.

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