RIM shares still under pressure
WATERLOO, Ont. - Shares of Research In Motion (TSX:RIM) were down nearly two-and-a-half per cent in pre-market trading as U.S. investors react to the BlackBerry maker's future plans after posting a US$125-million quarterly loss.
The company's shares (NASDAQ:RIMM) were down 33 cents to $13.40 before the market open.
RIM, which had been expected to show a profit when it reported after the market close on Thursday, attributed the loss to a $355-million asset writedown — reflecting the reduced value of its business.
The loss equalled 24 cents US per share compared with a profit of US$934 million or $1.78 per diluted share a year ago. Excluding one-time charges, RIM reported an adjusted profit of $418 million or 80 cents per share.
The company's revenue fell to $4.2 billion, down from $5.6 billion a year earlier.
The average analyst estimate had been for a profit of 81 cents per share and revenue of $4.54 billion, according to estimates compiled by Thomson Reuters.
Analysts had expected the company to ship 11.5 million BlackBerrys in the quarter but it reported only about 11.1 million were sold.
New chief executive Thorstein Heins, who got the job of steering the company in January, told analysts Thursday that "it's now very clear to me that substantial change is what RIM needs."
He said Research In Motion now will put more attention on its core business users: "We plan to refocus on the enterprise business and capitalize on our leading position in this segment."
Jim Balsillie, 52, also announced his retirement on Thursday. Balsillie had remained a director since losing his job as co-chief executive and co-chairman of the company in January.
Balsillie was, for many years, the main spokesman for the company as it grew from a small niche technology maker into a global leader in smartphone. He had shared the CEO and chairman roles with RIM co-founder Mike Lazaridis.
Activist shareholder Vic Alboini and chief executive of Jaguar Financial, who had been pushing for Balsillie to leave the company, said the departure of the former co-CEO was expected.
He also said the decision to pursue a strategic review has been a long time coming and could help push up the company's value.
However, RIM shares were down in extended trading after the earnings report, dropping 33 cents US below the official close of US$13.73 on Nasdaq.
The shares closed at C$13.69 in Toronto on Thursday before the earnings report, giving the company a market value of about $7.1 billion.
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