Borders Group Inc
Like its larger bricks-and-mortar rival Barnes & Noble Inc
But Borders has been much slower than Barnes & Noble, which introduced its Nook e-reader last year, to attack the e-books market and only launched its own e-bookstore in early July.
Borders' sales fell 11.5 percent to $526.1 million. Sales at its superstores open at least a year, or same-store sales, fell 6.8 percent, which follows a 17 percent decline in the year-ago quarter.
Underscoring how much ground Borders has to make up, the retailer said sales on its website had risen 56.2 percent to $15.5 million, but that only represents 3 percent of sales. At Barnes & Noble, they make up about one-tenth of sales.
As part of its strategy to catch up, Borders has cut the prices on some of the e-readers it sells.
In contrast to Barnes & Noble, Borders opted not to design its own e-reader, preferring to offer as many devices as possible to lure shoppers. It currently sells six e-readers, including a co-branded device with Kobo, and said it would add others in the coming weeks.
Borders reported a net loss of $46.7 million, or 67 cents a share, for the second quarter ended July 31, compared with a loss of $45.6 million, or 76 cents a share, a year earlier.
Excluding discontinued operations, the loss was 74 cents per share, compared with a loss of 75 cents a year ago.
On top of declining sales, Borders' gross margin took a hit as the bookseller cut prices, falling 3.7 percentage points to 19.3 percent. Borders got some relief from cost-cutting and the closure of some stores.
In a statement, Borders Chief Executive Mike Edwards said the retailer would also focus on making its superstores more enticing by offering more non-book items and cater more to children.
Barnes & Noble, which last week also reported a quarterly loss, also said it would dedicate more in-store space to toys and games.
Borders shares were unchanged in morning trading, but are down 69 percent since hitting a yearly high last September.
Borders operates 506 namesake superstores in the United States.
(Reporting by Phil Wahba; editing by John Wallace, Dave Zimmerman)