Newsletters
News & Information for Technology Purchasers NewsFactor Sites:       NewsFactor.com     Enterprise Security Today     CRM Daily     Business Report     Sci-Tech Today  
   
This ad will display for the next 20 seconds. Click for more information, or
Home Enterprise I.T. Cloud Computing Applications Hardware More Topics...
Mobile Tech
DDoS Protection Powered By Verisign
Average Rating:
Rate this article:  
RIM Remains Optimistic, Despite Q3 Hit

RIM Remains Optimistic, Despite Q3 Hit
By Jennifer LeClaire

Share
Share on Facebook Share on Twitter Share on Linkedin Share on Google Plus

Although optimism for RIM's BlackBerry 10 (BB10) has been growing in recent weeks and helping RIM shares more than double off the 52-week low, analyst Shaw Wu says there's still need for broader BlackBerry 10 support. On the upside for RIM, is the company's $2.3 billion in cash reserves, despite its huge operating losses.
 



Research In Motion's third-quarter results didn't surprise many analysts. Nevertheless, investors were selling off shares Friday as the BlackBerry-maker signaled falling unit sales and revenue. RIM only shipped 6.9 million BlackBerry smartphones and 255,000 BlackBerry PlayBook tablets.

Revenue for the third quarter of fiscal 2013 was $2.7 billion. That's down 5 percent from $2.9 billion in the previous quarter and down 47 percent from $5.2 billion in the same quarter of fiscal 2012. About 60 percent of RIM's revenues came from hardware, 36 percent for service and 4 percent for software and other revenue.

"RIM continued to execute on its product roadmap plans and to deliver on key financial metrics as it gets set for the global launch of BlackBerry 10," said Thorsten Heins, president and CEO of RIM. "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."

Handset Sales Slow

Heins remained optimistic. He said more than 150 carriers are completing technical acceptance programs for the first BlackBerry 10 products, and beta trials of BlackBerry Enterprise Service 10 are under way at more than 120 enterprises, including 64 Fortune 500 companies. BlackBerry 10 rolls out on Jan. 30.

Still, RIM admitted that the picture might grow dimmer before BlackBerry rises again. RIM expects to feel continued pressure on operating results as it gets set to launch its BlackBerry 10 platform in its fourth fiscal quarter. The company said it plans to consider using pricing initiatives on BlackBerry 7 devices and service fees in some markets as a way to maintain its subscriber base and drive more BlackBerry users.

RIM also noted that the timing of the BlackBerry 10 launch event could impact sales of current BlackBerry 7 products as some customers may put off purchase decisions and wait for BlackBerry 10 devices. All these factors are expected to affect unit volumes, subscribers, margins and service fees. RIM signaled a significant increase in its marketing spending this quarter to support the global launch of BlackBerry 10. That will lead to a fourth-quarter operating loss.

Hanging in the Balance

Shaw Wu, an analyst at Sterne Agee, told us the most important metric remains RIM's $2.3 billion in cash despite huge operating losses.

"It is not clear how sustainable this is as this is an accounting maneuver as opposed to an improvement in its fundamentals," Wu said. "The other big question is whether the company has a sustainable profitable business model where it needs to invest heavily to keep up with the vast resources of Apple, Google and Microsoft. The company is currently losing several hundred million dollars per quarter with profitability likely four to five quarters away."

Although optimism for BB10 has been growing in recent weeks -- and helping RIM shares more than double off the 52-week low -- Wu said there's yet a need for broader BlackBerry 10 support.

"For carriers, the rationale is simple where many are increasingly leery of the growing dominance of iOS and Android and have been looking for a viable third or potentially fourth platform with the hope that either BB10 and/or Windows 8 takes off," Wu said.

"But does the world really need a third or fourth mobile OS touchscreen platform? And what makes it different? So far, developer support and customer adoption have been lukewarm, so it remains to be seen if carrier hope wins out. To us, it's not just the number of apps, but the quality of apps, and whether developers are making money and customers are using them."
 

Tell Us What You Think
Comment:

Name:



Salesforce.com is the market and technology leader in Software-as-a-Service. Its award-winning CRM solution helps 82,400 customers worldwide manage and share business information over the Internet. Experience CRM success. Click here for a FREE 30-day trial.


 Mobile Tech
1.   Screen Troubles Briefly Slow iPhone 6
2.   Glass Adds Voice Access to Contacts
3.   Samsung, B&N Partner on Nook Tablet
4.   Acer Desktop Box Rides Chrome Wave
5.   Apple Stock Soars Ahead of iPhone 6


advertisement
HTC One M8 Windows Phone Unveiled
Can be POS device for small business.
Average Rating:
Android 'Fake ID' Puts Millions at Risk
Users: stick to apps from Google Play.
Average Rating:
Researchers Tout Battery Breakthrough
Lithium anode could triple capacity.
Average Rating:
Product Information and Resources for Technology You Can Use To Boost Your Business

Network Security Spotlight
Researchers Find Malicious Android Apps Can Hack Gmail
A new study shows that a weakness in the Android mobile operating system can be used to steal sensitive, personal info from unwitting users. Gmail proved to be the easiest app to attack; Amazon, the hardest.
 
UPS Stores in 24 States Hit by Data Breach
Big Brown has been breached. UPS said that about 105,000 customer transactions at 51 of its UPS Store locations in 24 states could have been compromised between January and August.
 
Cost of Target Data Breach: $148 Million Plus Loss of Trust
The now infamous Target data breach is still costing the company -- and its shareholders -- plenty. In fact, the retailing giant forecast the December 2013 incident cost shareholders $148 million.
 

Enterprise Hardware Spotlight
Acer's New Desktop Box Rides the Chrome OS Wave
Filling out its Chrome OS line, Acer is following the introduction of a larger Chromebook line earlier this month with a new tiny $180 desktop Chromebox and also a smaller Chromebook.
 
Feds OK $2.3 Billion IBM-Lenovo x86 Server Deal
IBM and Lenovo are celebrating U.S. approval of their x86-based server deal, having cleared some major security hurdles. The deal makes Lenovo a major player for enterprise data centers.
 
Three New Lenovo PCs Aimed at Business Users
Businesses everywhere want computing solutions that do more for less money, and Lenovo has unveiled three new desktop PCs that offer solid computing at a budget-minded price.
 

Mobile Technology Spotlight
Screen Shortage Briefly Puts Brakes on iPhone 6
RAM? Check. Antenna switch? Check. Screen? Oops. Parts suppliers for Apple have found themselves facing a shortage of screens for the new iPhone 6 as next month's release date for the new smartphone looms.
 
Google Glass Adds Voice Access to Phone Contacts
The latest update to Google Glass will let users access their top 20 phone contacts with voice commands alone. A user can then choose a phone call, Google hangouts, e-mail or text messaging.
 
Samsung, B&N Target Amazon with Nook Tablet
They've seen the enemy and it is Amazon. So Samsung and Barnes & Noble are teaming up to combat their common foe with a 7-inch tablet that blends Samsung’s tech, Nook’s content and e-reader platform.
 

Navigation
NewsFactor Network
Home/Top News | Enterprise I.T. | Cloud Computing | Applications | Hardware | Mobile Tech | Big Data | Communications
World Wide Web | Network Security | Data Storage | CRM Systems | Microsoft/Windows | Apple/Mac | Linux/Open Source | Personal Tech
Press Releases
NewsFactor Network Enterprise I.T. Sites
NewsFactor Technology News | Enterprise Security Today | CRM Daily

NewsFactor Business and Innovation Sites
Sci-Tech Today | NewsFactor Business Report

NewsFactor Services
FreeNewsFeed | Free Newsletters

About NewsFactor Network | How To Contact Us | Article Reprints | Careers @ NewsFactor | Services for PR Pros | Top Tech Wire | How To Advertise

Privacy Policy | Terms of Service
© Copyright 2000-2014 NewsFactor Network. All rights reserved. Article rating technology by Blogowogo. Member of Accuserve Ad Network.