Background: From Market Leader to Survival Mode

Barnes & Noble dominated U.S. bookselling in the 1990s and reached a sales peak around 2008. The following decade was a long decline. As Amazon expanded its lead in online retail and digital reading, the chain cycled through several chief executives and strategies, including heavy investment in the Nook e-reader and a broad mix of non-book merchandise. Competitors Borders and Waldenbooks closed entirely, leaving Barnes & Noble as the last large national bookstore chain in the United States.

In 2019, the activist investment firm Elliott Management acquired Barnes & Noble for roughly $683 million and took it private. Elliott already owned Waterstones, the largest bookstore chain in the United Kingdom, which it had turned around over the prior decade. The firm installed Waterstones chief executive James Daunt to lead Barnes & Noble, with Daunt relocating from London to New York and running both companies.

In simple terms: a turnaround investor bought a struggling but well-known brand cheaply, then applied a recovery playbook it had already tested on a similar business overseas.

James Daunt: The Bookseller Behind the Turnaround

The recovery playbook is closely tied to one person. James Daunt, born in 1963 to the British diplomat Sir Timothy Daunt, read history at Pembroke College, Cambridge, and began his career not in retail but in finance, working as a banker at J.P. Morgan in New York from 1985 to 1988. He left banking — by his own account, partly because the long hours were hard on his personal life — to build a business around his interests in reading and travel.

In 1990 he opened the first Daunt Books on Marylebone High Street in London, a shop initially specializing in travel writing and known for its galleried interior, curated selection and knowledgeable staff. The independent chain grew to roughly nine to ten London locations. That experience shaped a conviction Daunt would carry into much larger companies: that a bookstore succeeds when it is well presented, stocked with titles local readers actually want, and staffed by engaged, well-trained booksellers.

The Waterstones Precedent

Daunt’s reputation rests on an earlier rescue. By early 2011, Waterstones — then the last U.K. chain devoted solely to bookselling — was close to administration, having shut several stores and facing pressure from Amazon and the rise of e-readers. Daunt has said that without intervention the chain could have vanished within days, much as the U.S. chain Borders did. The Russian investor Alexander Mamut acquired Waterstones from HMV for about £53 million that year and appointed Daunt as managing director.

Daunt’s changes at Waterstones became the template for everything that followed. He decentralized buying so individual store managers chose much of their own stock, scaled back deep discounting, and recommitted to the in-store experience rather than chasing Amazon on price. After briefly stocking Amazon’s Kindle in a 2012 arrangement, the chain later stopped selling the e-readers as print demand held up. A central discipline was cutting “returns” — unsold books shipped back to publishers — which fell to roughly 3.5% at Waterstones, far below industry norms. Waterstones returned to profit within a few years, and Daunt became known in the British press as “the man who saved Waterstones.” He was appointed CBE in 2022 for services to publishing.

In simple terms: a high return rate means a retailer is buying books it cannot sell and paying to send them back, so cutting returns sharply was a direct way to stop wasting money and shelf space.

Applying the Playbook to Barnes & Noble

When Elliott Management — which had by then acquired Waterstones — bought Barnes & Noble in 2019 for roughly $683 million, it installed Daunt as CEO of both companies, and he relocated from London to New York. He inherited a chain he has described as run down by years of underinvestment and capital wasted on technology products, including the Nook e-reader, that did not pay off.

He applied the same approach. Buying authority was pushed down to individual stores, and a large share of the corporate book-buying staff was cut. Barnes & Noble stopped accepting publisher payments for prime in-store placement, and the company prioritized promoting booksellers from within. The contrast in returns illustrated the inefficiency Daunt was targeting: he told The Wall Street Journal that Barnes & Noble’s return rate was around 25%, against roughly 3.5% at Waterstones.

The throughline across all three businesses — Daunt Books, Waterstones and Barnes & Noble — is a single conviction: that local, well-run stores with knowledgeable staff outperform centralized, uniform big-box management. Daunt is among the few retail executives to have delivered comparable turnarounds on both sides of the Atlantic, which is why his methods now define Barnes & Noble’s strategy.

The Strategy: Run a National Chain Like a Network of Local Bookstores

The central change under Daunt was decentralization. Instead of dictating inventory, pricing and store layout from a corporate head office, Barnes & Noble pushed those decisions down to individual store managers and booksellers, who tailor each location to its local market.

Daunt has described the previous centralized model as an “extremely costly” head office that performed the merchandising job poorly, arguing that local staff understand their communities’ tastes better than a national buyer can. The approach borrows directly from the independent-bookstore model that survived the Amazon era by emphasizing curation, community ties and knowledgeable staff.

Several specific operational changes supported the shift:

Ending paid placement: Barnes & Noble stopped accepting payments from publishers to feature titles in prime in-store positions, freeing managers to display what they believe local readers want.
Local control of assortment and layout: Individual stores decide which titles to stock and how to merchandise them, producing a different mix from one location to the next.
Promoting from within: The company prioritized building a workforce of dedicated booksellers rather than importing managers from unrelated retail categories.
Smaller, refreshed stores: Daunt favored smaller, better-maintained locations over the sprawling superstores of the chain’s peak years.

The company has also acquired independent chains rather than only competing with them, taking over Colorado’s Tattered Cover and California-based Books Inc. after each faced bankruptcy, and allowing them to retain their names.

Examples: Where the Growth Is Showing Up

Barnes & Noble has confirmed 2026 store leases across ten states and the District of Columbia: California, Colorado, Florida, Georgia, Illinois, Ohio, Texas, Virginia, Washington state and Washington, D.C. Texas hosts more Barnes & Noble locations than any other state.

Much of the expansion involves returning to markets the chain once abandoned. The company has reopened locations in downtown Seattle, Park Slope in Brooklyn, Long Beach, California, and Bryn Mawr, Pennsylvania — in some cases in or near the same sites it vacated more than 20 years earlier. Operating from a base of roughly 600 stores, the chain frames many of these openings as a return to communities it previously served.

Impact: A Reading Revival and a Retail Outlier

Two forces outside the company have reinforced the strategy. A pandemic-era surge in reading drew consumers back toward physical books, and the online reading communities known as BookTok (TikTok), Bookstagram (Instagram) and BookTube (YouTube) generated viral demand for specific titles and genres. The “romantasy” category — romantic fantasy from authors such as Rebecca Yarros — has been a notable driver of in-store sales.

Barnes & Noble executives say younger readers increasingly visit stores to browse and to find titles trending online, and that the company monitors those communities to adjust each store’s mix. Industry observers have positioned the chain’s stores as “third places” — social spaces beyond home and work — built around books, cafés and in-person discovery.

The growth has also created jobs across the U.S. as the company staffs dozens of new locations each year. In April 2026, Time named Barnes & Noble to its annual list of the 100 most influential companies, citing several consecutive years of growth.

A note on the financial picture: because Barnes & Noble has been privately held by Elliott since 2019, it does not publicly disclose detailed financial statements, and the company has described its results only in general terms as “strong” sales growth. (Barnes & Noble Education, the separately traded campus-bookstore company, is a distinct business and is not part of the retail chain discussed here.) The clearest public evidence of the turnaround is therefore the pace of new store openings rather than audited revenue figures.

Analysis: Why the Turnaround Has Critics and Caveats

The decentralization model has skeptics. Some retail analysts caution that local autonomy succeeds only when store managers receive strong training and clear guidelines; without that, empowerment can produce inconsistency across locations. The strategy is also slower to scale than a centralized system, depending heavily on the quality of individual hires.

There are broader questions as well. Print’s resurgence is supported partly by social-media trends that could shift, and Barnes & Noble continues to operate alongside — not in place of — a large digital reading market dominated by Amazon. The lack of public financials makes it difficult for outside observers to assess profitability independently of store-count growth.

Even so, the chain’s trajectory stands out. By recommitting to books and to the in-store experience that distinguishes it from online sellers, Barnes & Noble has reversed a 15-year decline in store numbers and become one of the most-cited examples of brick-and-mortar resilience.

Conclusion

Barnes & Noble’s recovery rests on an unconventional bet: that the way to compete with a dominant online retailer is to act less like a national big-box chain and more like a collection of neighborhood bookstores. Combined with a print-reading revival and social-media-driven demand, that approach has turned the last major U.S. bookstore chain into a rare physical-retail growth story — though one whose long-term durability will depend on sustaining both the reading trend and the discipline of its store-level model.

Key Takeaways

Barnes & Noble plans about 60 new U.S. stores in 2026, after roughly 60 in 2025 and 57 in 2024 — more in a single year than it opened in the entire 2009–2019 decade.
The turnaround followed Elliott Management’s 2019 acquisition (about $683 million) and the appointment of CEO James Daunt, who previously revived the U.K. chain Waterstones.
The core strategy is decentralization: local store managers control inventory, layout and pricing, and the company stopped taking publisher payments for prime placement.
Confirmed 2026 leases span 10 states plus Washington, D.C., with many openings returning to markets the chain previously left.
A pandemic-era reading revival and BookTok-driven demand, especially for “romantasy,” have boosted in-store sales.
Because the company is privately held, it discloses no detailed financials; store-opening pace is the main public measure of its growth.

Sources

Fast Company — Barnes & Noble expansion plans (Dec. 2025) — https://www.fastcompany.com/91464784/barnes-and-noble-expansion-plans-record-number-stores-on-list
Fox Business — Barnes & Noble to open 60 new stores in 2026 — https://www.foxbusiness.com/retail/barnes-noble-open-60-new-stores-2026
Modern Retail — James Daunt and the art of the bookstore turnaround — https://www.modernretail.co/operations/barnes-noble-ceo-james-daunt-has-mastered-the-art-of-the-bookstore-turnaround/
Modern Retail — Why Barnes & Noble is buying indie chains — https://www.modernretail.co/operations/why-barnes-noble-is-buying-indie-chains-like-books-inc-and-tattered-cover/
Retail Dive — Elliott closes Barnes & Noble acquisition — https://www.retaildive.com/news/barnes-noble-new-owner-close-sale/560504/
RetailWire — B&N counts on store managers (return-rate comparison) — https://retailwire.com/discussion/barnes-noble-counts-on-store-managers-running-its-business-better/
Spear’s — How Waterstones’ boss James Daunt is keeping print alive — https://spearswms.com/wealth/waterstones-boss-james-daunt-keeping-print-alive/