There’s just one problem. The numbers don’t add up.
Barnes & Noble plans to open 60 new stores in 2026. Waterstones continues its steady expansion under James Daunt’s leadership. BookTok has millions of engaged users sharing their latest reads. Publishers trumpet record sales. The narrative is clear: books are back, retail is booming, and reading is cool again.
There’s just one problem. The numbers don’t add up.
The Narrative vs. The Numbers
Let’s start with what we’re being told. Since 2023, Barnes & Noble has been on an aggressive expansion trajectory: approximately 30 new stores in 2023, 61 in 2024, 67 in 2025, and now 60 planned for 2026. That’s nearly 220 new stores in four years. Waterstones, under the same ownership (hedgefund Elliott Advisors) and management (James Daunt), follows a similar pattern of measured expansion in the UK, with low double-digit new stores each year.
The explanation offered is simple to the point of being mindlessly simplistic: BookTok has created a new generation of readers, younger demographics are flocking to bookshops, and physical retail offers an experience that online shopping cannot match.
It’s a compelling narrative. It’s also largely a fantasy.
Strip out inflation, and real growth is either flat or slightly negative.
The actual sales data tells a different story. According to the Association of American Publishers, the US book market grew 4.1% in 2024, reaching $32.5 billion. In the UK, the Publishers Association reports total revenue of £7.2 billion in 2024, up just 1% from the previous year. These are not the figures of a booming market. As Carlo Carrenho 🇪🇺 has noted on many occasions, strip out inflation, and real growth is either flat or slightly negative.
More tellingly, when you examine where growth actually occurred, the picture becomes even clearer. In the US, digital audio revenue has increased nearly 80% since 2020 and now represents 11.3% of trade book formats. In the UK, digital audiobook revenue grew 31% in 2024 alone. This is genuine growth – but by definition it’s not what’s driving traffic through Barnes & Noble’s or Waterstones’ doors.
It’s a handful of genres performing well whilst everything else treads water or declines.
Print books, the actual product sold in physical bookshops, showed modest increases: US hardcovers up about 7%, paperbacks up 3%. In the UK, the 1% overall growth masks significant category shifts – fiction up 18% (driven by fantasy and romance), non-fiction down 4%. This isn’t a rising tide lifting all boats. It’s a handful of genres performing well whilst everything else treads water or declines.
The Concentration Effect
BookTok’s influence is real, of course, but it’s not creating more readers – it’s concentrating existing readers around a narrower selection of titles. The same books appear on recommendation lists again and again: Colleen Hoover’s backlist, Sarah J. Maas, Rebecca Yarros’s Fourth Wing, and a rotating cast of romantasy titles. These books sell in extraordinary numbers, far beyond what any midlist author could dream of achieving.
This creates an illusion of market growth. Bookshops can stock these viral titles with confidence, knowing they’ll move. It becomes a self-fulfilling prophecy as bookstore managers run in-store BookTok promo. Cash registers are busy. Publishers point to record-breaking sales for individual titles. But the total number of books being sold – and more importantly, the total number of people buying books – hasn’t grown proportionally.
The midlist is being eviscerated. Debut authors outside viral genres face an increasingly difficult market.
What we’re witnessing is a classic power law distribution becoming even more extreme. The top 1% of titles are doing spectacularly well. The midlist is being eviscerated. Debut authors outside viral genres face an increasingly difficult market. Literary fiction and narrative non-fiction struggle for shelf space and attention.
This isn’t a boom. It’s a consolidation.
The Demographics Problem
There’s another inconvenient question that rarely gets asked: who exactly are these BookTok buyers, and what are they actually purchasing?
For twenty years, reading for pleasure amongst school-age children has been in decline. Multiple reports in recent months have highlighted concerning literacy levels amongst school leavers both sides of the pond. Repeat for every month before that.
It’s a classic The Sky Is Falling industry narrative, but unusually, one with substance. As education standards plummet, fewer confident readers are entering the adult book market. The generation that grew up during the height of this decline is now the young adult demographic that BookTok supposedly represents.
We’ve seen this pattern before. Harry Potter and Twilight created cultural phenomena where the books became social signifiers – objects to be owned and displayed – without necessarily being fully read. Sales were clocked up. The publishing industry celebrated. But where was the sustained increase in overall book sales? Where was the generation of committed readers these phenomena supposedly created? What did the Harry Potter and Twilight generation read after Harry Potter and Twilight?
Books as Fashion Accessories: A History
The uncomfortable truth about Harry Potter and Twilight is that many of the children and teenagers who owned those books never finished them – in some cases, never even seriously started them.
This was particularly evident with Harry Potter amongst boys, the demographic that publishers were most excited to have “engaged.” Teachers, myself included, witnessed it firsthand: boys carrying Harry Potter and the Philosophers Stone (UK title for The Sorcerer’s Stone) like a badge of honour, able to bluff their way through playground conversations about the story, but quite unable to get past the first chapter of this doorstopper book. The possibility of them actually reading it? Not a snowball’s chance in hell.
Twilight faced a different problem – it was immediately coded as “girls’ reading,” which excluded half the potential audience from day one. But even amongst teenage girls, the phenomenon was as much about possession as consumption. The box sets became school-bag accessories, visual declarations of cultural participation. Whether the books had actually been read was immaterial to their social function. But as a teacher at the time, I’d wager fewer than half of the books bought were ever read.
An eerie conspiracy of silence.
This created an eerie conspiracy of silence across teaching and publishing. Teachers couldn’t admit that their students weren’t actually reading these books – that would be an admission of pedagogical failure.
Publishers certainly weren’t going to question sales figures or interrogate whether books purchased equalled books read. The narrative that more children, especially boys, were reading was too valuable to scrutinise. Facts were immaterial. Books were selling. The hype became self-fulfilling, and everyone benefited from maintaining the illusion.
Crucially, this all happened before e-books became mainstream. Print was the only option, which meant that owning the physical book was necessary for social participation in the phenomenon. You couldn’t prove you were part of the Harry Potter / Twilight conversation without the physical object.
Now we’re seeing a bizarre inversion of this dynamic. We live in an age where e-books and audiobooks offer sometimes cheaper, more convenient access to stories. Tech-savvy young people, who do everything else digitally and can’t function without a screen, are suddenly insisting on expensive hardcover editions of romantasy novels. Why?
Because the e-book version hidden on our phone or Kindle has no social value. Ordering a print copy online offers no opportunity to be seen joining the cool club on the high street. The book needs to be physical, it needs to be visible, and ideally it needs to be purchased in a bookshop where other people can witness our participation in the trend.
Romantasy books have become fashion accessories, social signifiers for a generation that communicates through visual platforms like TikTok and Instagram.
Romantasy books have become fashion accessories, social signifiers for a generation that communicates through visual platforms like TikTok and Instagram. The stunning covers, the collectors’ editions, the color-coordinated shelves – these are optimised for social media display, not for reading. Some books undoubtedly get read, but the purchase is often driven by the social capital of ownership rather than the intention to engage with hundreds of pages of text.
This is fantastic for print retail. It’s wonderful for the handful of authors and publishers whose titles become the season’s must-have accessories. But for the overall health of the industry? The impact is negligible. We’re not creating more readers or expanding the market – we’re just making reading visible in a way it wasn’t before.
I’m reminded of the time, way back in nineteen-bow-and-arrow, when I asked my Dad why he drove past the Shell petrol station to fill up at the Esso pump. Is it better petrol? Cheaper? “No, I just like the Esso jingle,” he confided.
Petrol advertising has always been about market share, not market growth. Nobody drives more miles because they use Brand A instead of Brand B – unless it’s to drive past Station A to get to Station B with the better jingle.
The same principle applies here. BookTok isn’t making people read more books overall. It’s determining which books the existing readers buy, and making the act of purchase more visible and socially rewarding. The market share is being redistributed, but the market itself isn’t meaningfully growing.
The Real Question
BookTok may well be more sustained than those earlier Harry Potter and Twilight moments – it’s already lasted longer than most publishing trends. But the fundamental question remains: if we’re in a literacy crisis, if young people aren’t reading for pleasure, how are they simultaneously driving a retail boom in expensive hardcovers?
The explanation is that BookTok represents a highly visible but relatively small cohort of very engaged readers who buy lots of books. They’re organised, vocal, and active on social media in ways that previous generations of avid readers were not (not least because social media as we know it did not exist then). This makes them appear larger and more influential than they are.
But they’re self-evidently not significantly more numerous than the dedicated readers who always existed – they’re just more visible, more concentrated around specific titles, and more likely to buy physical books for social signalling purposes rather than digital versions for private reading.
But… But… James Daunt is opening new retail stores like there’s no tomorrow!
And so he is. But Daunt is the last of the great bricks and mortar retail conjurors. Smoke and mirrors are his forte. Elitism his middle name. But he knows how to sell books!
The Retail Shuffle
The Barnes & Noble and Waterstones expansion needs to be understood not as evidence of market growth, but as retail optimisation. The company is moving from large-format stores in declining shopping centres to smaller stores in accessible neighbourhood locations.
This is essentially the model that independent bookshops have operated successfully for years, now being implemented with the economies of scale and publisher leverage that only a major chain can command.
This doesn’t necessarily mean more books are being sold. It means much the same books are being sold to much the same people, just more conveniently. And almost certainly, it means independent bookshops are being cannibalised in the process.
Consider the maths required to justify 60 new stores a year. Each location needs to generate sufficient revenue not just to cover rent, staff, and inventory, but to service the debt likely loaded onto Barnes & Noble’s balance sheet. In a market growing at 4% (and that’s before adjusting for inflation), where is this demand coming from?
The answer is that it’s mostly not coming from new readers. It’s being redistributed from existing channels – independent bookshops, online retailers, and the chain’s own larger legacy stores.
On the latter point, think one big B&N store closed, but three smaller stores opened, in different locations with less competition, lower rent and the same amount of books overall. Downplay the closure, hype the new stores.
It’s not just good business sense. The Big Box era is history. But Daunt is selling bookstores, not books. Remember, this was the guy who closed the Waterstones ebook store because no-one wanted ebooks, while selling Amazon Kindle devices in Waterstones stores because everyone wanted ebooks.
And let me just play that back again. James Daunt took over the failing Waterstone’s stores (they had apostrophes back then) and invited Amazon to sell Kindle devices in prime positions instore. You couldn’t make it up.
Daunt loves to project the cultural elite image, but then admits he’d sell “AI-slop” alongside his grandmother if there was a buyer with cash in hand.
So the subtle hints being dropped about a B&N/Waterstones IPO should be taken seriously – this aggressive expansion with a a gazillion new stores each year is no accident – but perhaps not welcomed with open arms.
The Private Equity Endgame
Barnes & Noble and Waterstones are both owned by Elliott Advisors (UK), the London affiliate of the USA’s Elliott Investment Management ($76 billion in assets) which acquired the chains in 2019 and 2018 respectively. Both companies were taken private, which means their financial details are not subject to public scrutiny. This is incredibly convenient when you’re building a narrative. And James Daunt is building a narrative.
There are persistent rumours of an imminent IPO – potentially taking both chains public together. Rumours fuelled by Daunt himself, of course.
Forbes this week references “sources” saying that B&N and Waterstones combined bring in c. $400 million in profits on roughly $3 billion in sales last year. Amazing how this sort of data leaks out when an IPO is being touted.
Accurate? Likely it’s not far off, but let’s not rush to break open the champagne.
Here’s the thing: The same Forbes article reminds us that, in 2019, “Barnes & Noble was going down fast, reporting a loss of $125.5 million on revenue of $3.7 billion for the 2018 fiscal year and having lost more than $1 billion in market value since 2014.”
So while B&N is apparently making a profit, its actual 2024 revenue was down by $0.7 billion on 2019. Between 2019-2025 B&N opened 178 new stores, and the 60 planned for 2026 will take the total new stores tally to 238.
Anyone see the disconnect here?
This is a familiar private equity playbook, and whilst we should be cautious about stating Elliott’s intentions as established fact, the pattern is hard to ignore. The aggressive expansion, the carefully cultivated media narrative about retail revival, the timing with BookTok’s peak visibility – these all align with a strategy to create an attractive IPO opportunity.
In this scenario, the “60 new stores” announcement isn’t primarily about serving customer demand. It’s about demonstrating momentum, growth, and confidence to potential investors. It’s about maximising valuation at the point of Elliott’s exit.
Let’s be honest. No-one in the industry seriously believes Barnes & Noble went from the brink of bankruptcy to opening hundreds of new stores just to meet the sudden new demand for books created by BookTok. And absolutely no-one in the industry seriously believes they are making a real profit in that short time.
The uncomfortable questions come later: What happens when those stores need to be profitable rather than just open? What happens when same-store sales figures become public? What happens when the debt loaded onto the company during the private equity ownership period needs to be serviced? What happens when the BookTok trend cycle moves on?
Daunt is 62. No-one would be surprised if he stepped down after the IPO, bowing out on a high note. And leaving the post-IPO chickens to come home to roost under new management.
What the Industry Doesn’t Want to Hear
The publishing industry has always been prone to enthusiastic narratives about revival and renewal. We’ve had several over the past two decades – e-books were going to revolutionise everything, then they weren’t; print was dead, then it wasn’t; young adult fiction was the future, then it was dystopian fiction, then it was romantasy.
Each of these narratives contained elements of truth, but they consistently overstated both the scale and the permanence of the changes they described. The current narrative about BookTok and retail revival follows the same pattern.
Here’s what the data actually suggests:
The market is not growing significantly. Total book sales, adjusted for inflation and excluding the audiobook category (which doesn’t drive physical bookstore traffic), are essentially flat.
Growth is concentrated in specific categories. Romance and fantasy are performing well. Almost everything else is static or declining. This is not a healthy, broadly based expansion.
Retail expansion is optimization, not growth. Better placement of stores serves existing customers more efficiently but doesn’t create new ones.
The winners are fewer and more dominant. A handful of authors, titles, and genres capture an ever-larger share of a market that isn’t expanding proportionally.
The midlist is being hollowed out. The concentration effect makes it harder, not easier, for most authors to build sustainable careers.
None of this means the industry is collapsing. But it does mean we should be sceptical of triumphalist narratives that don’t match the underlying data. We’re not witnessing a boom. We’re witnessing a reorganisation of a mature market, with growth in some areas being offset by decline in others.
The Uncomfortable Questions
If we’re serious about understanding what’s actually happening in book retail, we need to ask harder questions:
How many books does a new store need to sell just to break even, and where are those sales coming from? Are they genuinely new sales, or are they cannibalised from independent bookshops and online retailers?
If BookTok is driving millions of new readers, why aren’t overall market figures growing proportionally? Why do we still have a literacy crisis amongst the exact demographic that’s supposedly fuelling this boom?
Why are publishers and retailers so keen to conflate different revenue streams – print, e-book, and audio – when they serve different purposes and drive different behaviours?
What happens to Barnes & Noble’s shiny new stores if the BookTok trend cycle moves on, or if the economy shifts, or if the carefully constructed narrative meets the reality of quarterly earnings reports?
And most pointedly: who benefits from the current narrative, and who might be left holding the bag when reality intrudes?
The Deckchairs Theory
No, we’re not rearranging deckchairs on the Titanic – book retail isn’t sinking. But we are shuffling the same deck of cards whilst treading water.
The industry isn’t growing meaningfully. It’s consolidating around a smaller number of very successful titles, optimising its retail footprint, and benefiting from format shifts (particularly to audio) that have little to do with the physical retail expansion being celebrated.
This matters because resource allocation follows narrative.
This matters because resource allocation follows narrative. Publishers invest in what they believe is growing. Authors chase the genres that seem to be succeeding. Retailers expand based on projections of future demand. If the narrative is wrong – if we’re mistaking consolidation and optimisation for genuine growth – then we’re making strategic decisions based on flawed assumptions.
The IPO, when it comes, will be illuminating. We’ll finally see whether Barnes & Noble’s expansion is built on solid fundamentals or on private equity financial engineering. We’ll see whether same-store sales justify the growth trajectory, or whether the company has been loaded with debt that will constrain its future.
Until then, we should be considerably more sceptical of the boom narrative. The deckchairs have been rearranged more attractively, and some passengers are having a wonderful time. But the ship isn’t going faster, and we’re not picking up significantly more passengers along the way.
The sooner the industry acknowledges this, the better positioned we’ll be for whatever comes next.
This post first appeared in the TNPS LinkedIn newsletter.
