RIM results, outlook stun investors even after warning
By Alastair Sharp
(Reuters) - Research In Motion reported a steep drop in quarterly profit on limp sales of its smartphones and tablets, and offered investors little hope of a turnaround anytime soon, sending its shares tumbling.
RIM, which launched a string of refreshed BlackBerry phones in recent weeks, painted a dismal picture for its current quarter and said it now expects to reach only the lower end of an already reduced full-year outlook in a quarterly financial report issued late Thursday.
"This report is another nail in the coffin of management," said Edward Snyder, an analyst at Charter Equity Research. "Even though they guided down for this quarter, they still fell short of that."
The flagging performance by the one-time smartphone leader shows how far BlackBerry, once a byword for corporate communication, has fallen out of favor with both consumers and investors as Apple's iPhone and devices running Google's Android software take oversized bites out of the booming market, especially in the United States.
"It's pretty clear the BlackBerry platform is now in decline, said analyst Tavis McCourt at Morgan Keegan. "They really need QNX to reinvigorate the business."
RIM is hitting the labs to get the QNX software powering its PlayBook tablet onto its next generation of smartphones, possibly as soon as early 2012.
The limp numbers pile pressure on senior executives, who have been cajoled to step aside by investors and analysts worried about repeated failures to execute on strategy.
"If QNX is a bust that's when RIM needs to make strategic decisions as to whether it can go it alone," McCourt said. Continued...