RIM posts sales jump, gives weak outlook
The BlackBerry maker faces increased competition from Apple and Palm.
Research In Motion (RIMM) late Thursday posted what looked like a strong earnings report, but the BlackBerry maker gave a weak revenue forecast for the current quarter.
Shares were down $3.77, or 4.9%, to $72.78 this afternoon.
RIM earned $643 million, or $1.12 per share, in its fiscal first quarter, a 33% increase from the $482.5 million, or 84 cents per share, it earned in the same period last year. Excluding one-time items, Research In Motion said it would have earned 98 cents per share, topping analysts' estimates of 94 cents per share.
Revenue surged 53% to $3.42 billion, in line with Wall Street's expectations.
The company added 3.8 million subscribers in the quarter, pushing its total to almost 29 million. But that was below the 3.9 million analysts had expected.
On Wednesday, Research In Motion Co-Chief Executive Officer Jim Balsillie said the company has more than 1 million government clients.
And the company said on Tuesday that it will introduce its BlackBerry Tour this summer.
For the second quarter, which ends Aug. 29, RIM expects revenue of between $3.45 billion and $3.7 billion and earnings per share of between 94 cents and $1.03.
It sees its subscriber base growing by 3.8 million to 4.1 million. Analysts are forecasting earnings of 97 cents a share on revenue of $3.61 billion.
RIM faces competition from Apple (AAPL), which introduced a new version of its popular iPhone, and Palm (PALM), which debuted its new Pre earlier this month. The lower-than-expected subscriber growth may mean Apple and Palm are starting to have an effect on RIM.
Shares of Apple were up $3.60, or 2.7%, to $139.48 this afternoon, and Palm shares had risen 87 cents, or 6.7%, to $13.93.
"The pressure on RIM is growing," Nirav Parikh, equity analyst at TCW Group, told Bloomberg News. "It's not just (Apple's) iPhone anymore, but a second competitor that is possibly even better than the iPhone operating system," Parikh said, referring to Palm's new Pre device.
Still, BlackBerry dominates the handheld market, with about 55.3% share of the market in the first quarter, according to IDC data. The iPhone had 19.5% of the market.
Piper Jaffray analyst Gene Munster is forecasting Apple will sell 500,000 of its iPhone GS this weekend, about half as many as the iPhone 3G had in its July 2008 debut, according to Bloomberg News.
Charley Blaine contributed to this report.
Copyright © 2013 Microsoft. All rights reserved.
Quotes are real-time for NASDAQ, NYSE and AMEX. See delay times for other exchanges.
Fundamental company data and historical chart data provided by Thomson Reuters (click for restrictions). Real-time quotes provided by BATS Exchange. Real-time index quotes and delayed quotes supplied by Interactive Data Real-Time Services. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by SIX Financial Information.
[BRIEFING.COM] The major averages trade near their best levels of the day with the S&P 500 off by 0.1%.
In the foreign exchange market, the Dollar Index trades lower by 0.7% at 83.73. The index has weakened throughout the session as dollar weakness gave a boost to the Swiss franc and the Japanese yen.
The USDCHF pair is off by 115 pips at .9675 as trade reverses sharply off yesterday's 10-month high. The .9650 area is likely to receive significant attention as further ... More
More Market News
|There’s a problem getting this information right now. Please try again later.|
LATEST MARKET DISPATCHES
- No more Dispatches; here's where to find market news
The Market Dispatches column has been discontinued. Here's where to find the latest stock and business news on MSN Money, and the latest from market writer Charley Blaine.
- Dow falls 59 as late-day gloom kills a rally
- Stocks held back by fiscal-cliff worries
- Stocks suffer worst weekly loss in 5 months
- Dow off 121 as post-election swoon continues
- Dow slumps 313 after Obama's re-election
- Dow jumps 133 as Americans head to the polls
With Europe mired in recession, China faltering, commodities declining and stocks looking vulnerable, investors seeking safety will look to the greenback.