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Last Update: 21-Dec-12 07:40 ET
Research In Motion shares plunge 11% following third quarter loss and disappointing BB metrics
Research In Motion (RIMM $12.38 -1.80) reported a third quarter loss of $0.22 per share, excluding non-recurring items, $0.13 better than the Capital IQ consensus of ($0.35), while revenues fell 47.2% year/year to $2.73 billion versus the $2.67 bln consensus. The revenue breakdown for the quarter was ~60% for hardware, 36% for service and 4% for software and other revenue. During the quarter, RIM shipped ~6.9 million BlackBerry smartphones and ~255,000 BlackBerry PlayBook tablets. Outlook: The company expects that there will be continued pressure on operating results as it gets set to launch its BlackBerry 10 platform in the fourth quarter. The co intends to continue to consider using pricing initiatives on BlackBerry 7 devices and service fees in some markets as a way to maintain our subscriber base and drive more BlackBerry users. The timing of the BlackBerry 10 launch event for January 30, 2013 could also impact sales of current BlackBerry 7 products as some customers may defer purchasing decisions and wait for BlackBerry 10 devices. All these factors are expected to impact unit volumes, subscribers, margins and service fees. In addition, the co will be significantly increasing its marketing spending this quarter as expected, to support the global launch of BlackBerry 10, and the co expects to report an operating loss for the fourth quarter. RIM also announced today that Robin Bienfait, Chief Information Officer for RIM has made the decision to retire at the end of this year following 6 years of service to the Company. Robin has committed to continue supporting RIM in an advisory capacity to enable a smooth launch and seamless transition. "During the third quarter, we continued to demonstrate our strong financial position, generating $950 million in cash flow from operations, and increasing our cash position significantly to more than $2.9 billion."
