Shares in Research In Motion (RIM) fell almost 10 percent in after-hours trading yesterday as the BlackBerry-maker reported weaker than expected quarterly profit and an outlook that disappointed analysts. Revenue for the company’s fiscal second-quarter (ended 29 August) was US$3.53 billion – up 37 percent from US$2.58 billion in the same quarter of last year – while GAAP net income for the quarter was US$475.6 million, down from US$495.5 million a year ago. Adjusted net income (excluding payments related to its recent patent litigation with Visto Corporation) was US$588.4 million. The company’s main devices segment accounted for 81 percent of revenue (in addition to 14 percent for services, 2 percent for software and 3 percent for other revenue). RIM said it shipped approximately 8.3 million devices in the quarter and added 3.8 million net new BlackBerry subscriber accounts, bringing its total BlackBerry subscriber base to around 32 million.
Jim Balsillie – RIM’s co-CEO – was upbeat on the results and the vendor’s prospects for the second half of its fiscal year. “RIM is entering the second half of the fiscal year and approaching the holiday buying season with an impressive product portfolio, continuing business momentum and strong marketing support from our partners around the world,” said Balsillie in a statement. RIM forecast revenue for its current quarter (ending 28 November) in the range of US$3.60-US$3.85 billion, a gross margin of 43 percent and net subscriber additions in the range of 4.0-4.3 million. However, the outlook received a lukewarm reception from many analysts. “A lot of people on [Wall] Street have been talking up Q3 as one where RIM was going to come and blow everybody away and so there was this expectation and even though it’s perfectly decent guidance with all kinds of great year-over-year growth and gross margins, it doesn’t live up to the advance billing,” Duncan Stewart, an analyst at DSAM Consulting, told Reuters.
Comments