The lack of a strong title like last year's "Harry Potter"caused sales to dip slightly from $1.17 billion a year earlier to$1.16 billion, the company said. Sales at its smaller B. Daltonstores were off 31%, dropping to $21.9 million. At stores open atleast a year, sales at the company's flagship chain were down 2.6%while same store sales dropped 9.1% at B. Dalton during thequarter. Sales at Barnes & Noble.com also declined 14 % to$82.7 million, the company said.

"We look back at the first half of this year as one of thesoftest periods in recent memory for the book industry in terms ofhardcover new releases," Steve Riggio, chief executive officer ofBarnes & Noble, during a conference with investors andanalysts. "There were simply very few new hardcover books thatgenerated media buzz or sustained sales by word-of-mouthrecommendations."Riggio said sales would have been positive if lastyear's Harry Potter sales were not counted.

The company, which operates 687 Barnes & Noble stores and112 B. Dalton stores, said it also opened four stores under itsnamesake banner and closed two stores in each of its booksellingchains.