Barnes & Noble sells a stake in Nook as sales fall short

NEW YORK - Barnes & Noble moved to shore up its struggling Nook Media division Friday, agreeing to sell a 5 percent stake to Pearson, a British publishing and education company, for $89.5 million.

In a sign of the headwinds the bookseller is facing, the company said in a regulatory filing that holiday sales were weaker than expected and that its Nook unit would fall short of projections for 2013.

The forecast underscores the difficulties Barnes & Noble is having as it tries to build out its digital business and compete in a crowded market with giant companies like Amazon, Apple and Google. Sales for the first generation of e-readers having been dropping rapidly as consumers shift to tablets that can offer other forms of media like music, games and video. Just this week, Amazon was trumpeting banner sales of its Kindle Fire tablet over the holidays.

By contrast, worldwide shipments of e-readers fell 36 percent in 2012, according to a report released this month by IHS iSuppli, a market research firm.

"The market's growth is slowing down," said James McQuivey, a media analyst with Forrester Research, referring to e-readers.