RIM shares drop, BlackBerry shipments disappoint
By Euan Rocha
TORONTO, June 24 (Reuters) - Research in Motion on Thursday reported subscriber and shipment figures that disappointed investors and rekindled fears that the BlackBerry maker is losing market share to Apple Inc and other rivals.
Shares of RIM tumbled more than 5 percent in after-hour trade even as the company said its quarterly profit rose almost 20 percent. The profit topped expectations, but failed to calm edgy investors, who are concerned by RIM's waning fortunes in its core North American market.
Adding to the concern, a 24 percent jump in revenue fell short of the Wall Street consensus view, due to weaker-than-expected unit shipments and fewer-than-expected subscriber additions. Gross profit margins also receded, suggesting that low-priced models were a growing part of the sales mix.
Overall, the results did little to dispel the perception that competition from the likes of Apple's iPhone and Motorola's Droid is stiffening.
Charter Equity analyst Ed Snyder said investors were hoping to see more phones sold, with stronger profit margins.
"It's a mixed report. It's a little light on revenue and light on units for this quarter," he said. "It's not the strong report everybody had been hoping for. The market is in a bad mood so its a tough time to be giving a mixed bag."
RIM's results came in the same day as the global launch of the iPhone 4, the latest version of Apple's wildly popular touchscreen smartphone. Apple sold 600,000 of the new devices in pre-orders in a single day last week, and analysts expect over 1 million sold in stores on the first day.
"RIM's doing a good job in profitability. They're just not showing as much unit growth as people would have liked," said CIBC analyst Todd Coupland. Continued...