RIM's third quarter just as disastrous as expected

BlackBerry maker reports 71% drop in earnings; co-CEOs offer more happy talk

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Research in Motion on Thursday dropped the third-quarter earnings bomb it promised early this month, reporting a 71% plunge in net income after a $485 million charge for the thousands of unsold PlayBook tablets gathering dust somewhere.

RIM reported Q3 net income of $265 million, or 51 cents per share, compared with net income of $911 million, or $1.74 per share, in the year-ago quarter and earnings of $329 million, or 63 cents a share, in the second quarter of this year.

Excluding the PlayBook write-off, RIM's earnings were $1.27 a share, above the $1.19 a share consensus estimate of analysts. In early December, the Canadian BlackBerry maker said it expected Q3 earnings on the low side of previous guidance calling for net income of $1.20 to $1.40 a share.

Revenue for the company was $5.17 billion, or 6% below the $5.5 billion in last year's Q3.

But don't worry, shareholders, co-CEOs Jim Balsillie and Mike Lazaridis see better days ahead! Here's a joint statement from the duo that accompanied the earnings release:

“RIM continues to have strong technology, unique service capabilities and a large installed base of customers, and we are more determined than ever to capitalize on our strengths to overcome the recent execution challenges surrounding product launches and the resulting financial performance. As part of our commitment to improving our performance to better meet the expectations of shareholders and customers, we continue to evaluate ways to improve in several areas of the Company’s operations. It may take some time to realize the benefits of these efforts and the platform transition that we are undertaking, but we continue to believe that RIM has the right set of strengths and capabilities to maintain a leading role in the mobile communications industry.”

Yeah, and Michele Bachmann's going to win in Iowa.

Shares of RIM (NASDAQ: RIMM) fell as low as $13.94 in after-hours trading, or 7.9%. This after dropping 2.6% on Wednesday. The company's stock is down more than 70% for the year.

Earlier in December, RIM fired a pair of executives for getting drunk on a flight to China, causing the pilot to return to Toronto. The wrong two executives were fired.

I just don't see how Balsillie and Lazaridis can survive much longer. In the earnings call with analysts after the Q3 release, Balsillie said he and Lazaridis have asked that their annual salaries be reduced to $1. They'd still be overpaid.

Also in the earnings call, Lazaridis described how the next version of the PlayBook (like they'll be one) will work with the company's enterprise server, a combination he referred to as RIM's "secret sauce." And I thought it was an hallucinogen.

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