Cue the marching band….
First Half Reports
With the publishing industry’s first half of 2022 in the books (see what I did there?), we all feel pretty good about the unnoteworthy results: flat. If you’ve been with the Update for the last year or two, you know that the industry has been rocking and rolling (intentionally mixing metaphors because it’s fun).
Through June 30, 2022, trade book sales were hanging in there with the same period for 2021. The American Association of Publishers (AAP) reported survey results with sales off only 1.6% for the first six months of the year. Adult sales fell 2.6%, but children and YA sales picked up much of the slack, coming in at 4.3% over 2021.
Corporate earnings reports for Q2 are here, with publishing hot-shot—and the focus of so much courtroom drama of late—Simon & Schuster still crushing it. S&S saw revenues increase 34% and profits jump 54% over Q2 2021, with CEO Jonathan Karp giving special thanks to #BookTok darling Colleen Hoover.
S&S’s suitor, Penguin Random House, saw revenue increase 6.2%, but watched earnings fall a painful 20.7% due to inflation and supply chain woes. It begs the question of who should be acquiring whom. ICYMI, Publishers Weekly did some great reporting on the blow-by-blow of the publishing industry’s trial of the century, if you want to get caught up while we anxiously await Judge Florence Pan’s ruling on the Justice Department’s suit to stop the mega-merger.
HarperCollins, whose fiscal year ended June 30, reported a 1% increase in earnings for FY ’22, even though they saw sales jump 10% -- cue those pesky rising manufacturing and shipping costs. Makes you wonder what S&S is doing that the others aren’t to keep those inflationary pressures at bay.
The Backlist Revolution
Most of you may know that book publishing has always been a 2-class system: frontlist and backlist. Definitionally, the frontlist refers to all the books published in the last 12 months, and the backlist is everything else. Frontlist gets all the attention—and the marketing budget—while backlist pays the bills.
Well, the smart people at NPD BookScan have been tracking that dichotomy for a while and have seen increasing sales of backlist titles compared to frontlist titles. The share of book sales from backlist titles was 62% in 2019, but is now up to 70% so far this year. If you’ve been in the game awhile, that might be comforting. But if you’ve been gearing up for your first publishing rodeo (metaphor mixing again—told you it was fun), you are competing for a bite of a shrinking piece of the pie (and again).
Disturbing Amazon Rumors
PW found that a number of publishers have been noticing a slowdown in orders by the online retail giant, even while the publishing industry seems healthy. Some point to Amazon’s plans to cancel, close or delay the construction of 49 distribution facilities after reporting a soft first quarter. Labor market struggles and inflation (the “I” word seems to appear in every story these days) could also be contributing factors. But PW, who actually found a person to talk to at Amazon, was told that there was no truth to rumors of Amazon moving away from the bookselling business.
Weekly Numbers—August 2022
Here are the weekly results for August:
Week ended August 6, 2022: Down 2.1%
Week ended August 13, 2022: Down 2.9%
Week ended August 20, 2022: Down 3.7%
Week ended August 27, 2022: Flat (which is better than a poke in the eye).
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