BNED Reports 24% Enrollment Growth and $91.8M Debt Reduction: Financial Turnaround Gains Momentum
Enrollment in First Day Complete Jumps 24%, Accelerating Top-Line Growth
Barnes & Noble Education (NYSE:BNED) released its preliminary full-year fiscal 2025 and first half fiscal 2026 results, highlighting rapid adoption of its First Day Complete program, which saw enrollment surge by 24% year-over-year to approximately 1.14 million students this fall. With 223 campus stores participating, this jump underscores the increasing institutional buy-in for BNED’s inclusive course materials model—a key engine behind the company’s rising revenue and operating momentum.
Revenue Climbs, Operating Results Improve Sharply
Fiscal 2025 preliminary revenue rose to $1.6 billion, up 2.6% from the prior year, with comparable store sales gaining 7.5%. Importantly, First Day program revenue grew 25.3% year-over-year. In the first half of fiscal 2026, unaudited revenue is up 7.8%, supported by top-line growth across campus retail operations.
Net Income Swings Positive; Adjusted EBITDA Expands Significantly
The first half of fiscal 2026 marked a major milestone: net income is now expected to fall between $3.0 and $8.0 million, a striking improvement over a net loss of $(59.0) to $(65.0) million in the prior period. Full-year 2025 net losses narrowed significantly despite a one-time $55.2 million non-cash charge related to debt extinguishment. Adjusted EBITDA also improved sharply:
| Period | Net Income ($ millions) |
Adjusted EBITDA ($ millions) |
Revenue ($ billions) |
|---|---|---|---|
| FY 2025 (preliminary) | $(68.0) – $(62.0) | $55.0 – $63.0 | $1.60 |
| FY 2024 (restated) | $(78.0) – $(72.0) | $34.0 – $40.0 | $1.56 |
| H1 FY 2026 (prelim.) | $3.0 – $8.0 | $32.0 – $42.0 | $0.93 |
| H1 FY 2025 (restated) | $(65.0) – $(59.0) | $30.0 – $36.0 | $0.86 |
Net Debt Down 49%, Balance Sheet Strengthens Dramatically
BNED reduced total net debt to $94.0 million as of May 3, 2025, down $91.8 million year-over-year. Net working capital improved substantially to $188.9 million, and short-term obligations shrank by $194.0 million from the prior year—signs of disciplined expense control and strong cash management. By the end of the second quarter of fiscal 2026, net debt is expected to decrease by another $55.2 million versus the year-earlier quarter.
Board Sees Progress, Eyes Margin Expansion Ahead
Leadership called out the “strong improvements in operating results and balance sheet” while noting opportunities for continued growth and gross margin expansion heading into fiscal 2027. For fiscal 2026, management is guiding for Adjusted EBITDA in the $65–$75 million range despite headwinds from a shorter fiscal year. BNED anticipates ongoing benefits from cost discipline, innovation, and a growing customer base—highlighted by rising interest in new services like Room Service.
Internal Investigation Resolved Without Broader Impact
Earlier accounting irregularities linked to one former employee are now fully addressed, according to BNED’s board, with no evidence of wider involvement or financial misconduct. Restated results now reflect accurate costs and leave the business well-positioned for future transparency and compliance.
Takeaway: Momentum Building, Risks Remain
BNED’s rapid debt reduction, strong enrollment gains in its First Day programs, and shift back to net income suggest that operational and financial headwinds are easing. As cost controls remain tight and product innovation expands, investors will be watching for BNED to sustain its growth trajectory—even as macro risks linger in the broader education and retail sectors. The company’s improved balance sheet and focus on execution could mark a meaningful financial turnaround if these trends hold.
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