Research In Motion shares on Thursday tumbled 10% after the troubled smartphone pioneer reported a sharp decline in profit and a slip in subscribers.
The BlackBerry maker reported a third-quarter profit that slid 97% on revenue that was down 47% compared with the same period a year ago, beating Wall Street's expectations.
RIM also noted that it shed 1 million subscribers, down to 79 million in the quarter. The company also cautioned over service fees and increased spending on marketing of its next-generation devices.
Shares of RIM slid $1.37 at $12.75 in after-hours trading.
RIM is under siege from the likes of Apple's iPhone and Android-based devices as it struggles for relevance in a market it once ruled.
Waterloo, Ontario-based RIM eked out a quarterly profit of $9 million, or 3 cents a share, on revenue of $2.73 billion. In the same quarter a year ago, it reported a $265 million profit, or 51 cents, on $5.17 billion in revenue.
Analysts were forecasting a loss of 35 cents per share, according to the survey of estimates from Thomson Reuters. On an adjusted basis, RIM reported a loss of 22 cents per share.
RIM's stock price has shown signs of a pulse over the past three months, with shares more than doubling in value. On Sept. 20, the stock closed at $6.91.
"We have put in place a clear road map," RIM CEO Thorsten Heins said on a conference call with analysts. "Today we are on the verge of launching BlackBerry 10."
The future of RIM rests on BlackBerry 10. Its upcoming smartphone line will be available Jan. 30 as a touchscreen-only device or version with its classic hard keyboard. RIM's revamped BlackBerry operating system includes a predictive text keyboard and BlackBerry Hub that users can access at any time to view texts, emails and other information.
FIRST IMRPESSIONS: BlackBerry 10
The features for BlackBerry 10 fall more in line with the traditional options many consumers have expected in the smartphone market, currently dominated by Google's Android and Apple's iOS, and which also includes a rising line of Windows 8 phones.
Heins said that management remains "laser focused" on returning the company to profitability. He said that RIM remains focused on being a leaner organization in a bid to conserve cash. RIM's cash reserve grew $600 million in the quarter to $2.9 billion.
In September, RIM said it hosted 80 million subscribers after posting better than expected revenue during its second-quarter earnings report.
Source: http://www.news.theusalinks.com/2012/12/20/rim-profit-skids-97-but-beats-street/
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