RIM posts smaller than expected loss; shares surge
(Reuters) - Research In Motion reported a smaller-than-expected quarterly loss on Thursday and boosted its cash cushion, sending its shares soaring more than 7 percent.
But the struggling BlackBerry maker also recorded the first-ever decline in its subscriber base, barely a month before the crucial launch of the new BB10 smartphone line.
RIM reported a loss of $114 million or 22 cents a share, excluding one-time items. Analysts, on average, had forecast a loss of 35 cents a share, according to Thomson Reuters I/B/E/S.
RIM shares, which closed 3.6 percent higher at $14.12 on Thursday, rose 7.6 percent after the closing bell in the United States to $15.20, as investors cheered the surge in RIM's cash pile ahead of next month's launch of the new BB10 devices.
RIM built its cash cushion up to $2.9 billion in the quarter, from $2.3 billion in the prior period. RIM will need the funds to manufacture and promote its new line of products ahead of the January 30 launch.
The Waterloo, Ontario-based company hopes to reinvent itself and revive its fortunes with the BlackBerry 10. It also reported a surprise net profit in its fiscal third-quarter, reflecting a one-time tax gain from restructuring of its international operations.
In the period ended December 1, RIM reported net income of $9 million, or 2 cents a share. That compared with a year-ago profit of $265 million, or 51 cents.
RIM said its subscriber base fell to about 79 million in the quarter from about 80 million in the period ended September 1.
The decline is a disconcerting marker in the history of RIM, which virtually invented the concept of on-the-go email. In recent years, RIM's user base has grown, even as the BlackBerry lost ground in North America and Europe, boosted by gains in emerging markets.
The company, whose aging line of BlackBerry devices has lost ground to the likes of Apple Inc's iPhone and a slew of devices powered by Google Inc's Android operating system, said it shipped 6.9 million smartphones in the quarter.
(Reporting by Euan Rocha; Editing by Janet Guttsman and Phil Berlowitz)
© Thomson Reuters 2015 All rights reserved.