RIM quarterly falls short of expectations
By Wilson • Apr 7th, 2010 • Category: Industry News
- Photo: Research In Motion
Research In Motion, the company behind the popular BlackBerry smartphone, have just had their quarterly earnings call and all the metrics impressed except for earnings slightly underperforming expectations.
Earnings disappointment
Finance is particularly funny in that, even if a company performs well, if their earnings are below the expectations of financial analysts, that performance is considered a disappointment. To that extent, RIM’s quarterly revenue disappointed in that it was expected to be $4,31 billion (£2,83 billion) and ended up being about $4,08 billion ($2,68 billion).
Most BlackBerry activations ever
- Photo: BlackBerry
Outside of that one disappointment, everything else was encouraging for Research In Motion, with the company reporting the most quarterly BlackBerry activations in its history, with 4.9 million additional accounts, bringing the company’s subscriber base to 41 million. To put that in perspective, over 10% of Research In Motion’s Blackberry subscriber base was brought in in the last three months, while the contemporary smartphone device has been around for eight years, now.
In addition, annual revenue rose $15 billion, which is 35 per cent higher than the previous year’s revenue.
Future rosy
Jim Balsillie, the company’s co-CEO, indicated that they’re off to a great start in fiscal 2011 and expect earning for Q1 to be in the range of $1.31 to $1.38 per share, which already exceeds analysts’ current estimates.
- Photo: Apple
Even then, though, the company’s value dropped around 1% in trading on the day of the earnings, showing analysts’ expectations have a greater bearing on a company’s stock price in the short term than the company’s actual performance.
Smartphone war
Research In Motion, which for a short period was the only serious smartphone contender in town, finds itself in a three-way race with Apple’s iPhone and Google’s Android for industry dominance, with Microsoft’s Windows Phone 7 Series set to join the fray. And, even with RIM growing at an astronomical 35 per cent per annum, the competitors are still catching up.
Tags for this article: smartphone, blackberry
