RIM Q4 Revenue Falls Short, Balsille Resigns From Board6:53 PM EST Thu. Mar. 29, 2012
Research In Motion announced lower-than-expected fourth quarter fiscal earnings Thursday, as concerns over the company’s future continue to mount. It also announced the resignation of former co-CEO and board member Jim Balsillie.
The Waterloo, Ontario-based BlackBerry maker reported quarterly revenue of $4.2 billion, down 19 percent from the $5.2 billion reported in the previous quarter and down 25 percent from the $5.6 billion it reported in the same quarter last year.
RIM's net loss for the quarter was $125 million, compared to a $934 million profit reported in the year-ago quarter. The company reported earnings of 80 cents a share. Analysts had expected RIM to report earnings of 81 cents a share on $4.54 billion in revenue.
RIM’s shipment numbers also took a significant hit. The company said it shipped 11.1 million units over the three-month period, which is down 25 percent from the 14.1 million it shipped in the third quarter. The company reported 500,000 shipments of its struggling PlayBook tablets.
[Related: Succession Plan: RIM Names New CEO]
RIM CEO Thorsten Heins, who took the position in January, attributed the decline to the bring-your-own-device (BYOD) trend threatening its traditional enterprise user base, a continuously shrinking U.S. subscriber base, and increased competition in international markets.
Heins, who originally said he planned no “seismic changes” for the company upon his appointment as chief executive, seemed to have had a change of heart.
"The impression I had after two days as CEO is very different from the impression -- not the impression, the facts -- I discovered after being here for 10 weeks as CEO," he said during the financial analyst call Thursday. "I am convinced that substantial change is what we need."
Heins outlined his plans for making this "substantial change" a reality, and the upcoming release of RIM’s new mobile OS, BlackBerry 10, topped his list. He expressed full confidence not only in BlackBerry 10 smartphones, but in the platform itself and a robust app ecosystem behind it. He also made a commitment to unveil the new product on time -- sometime "later this year" -- despite RIM’s notoriety for delayed product launches.
"I have seen the first working [BlackBerry 10] software on actual devices and was intrigued by the stability, performance and beauty of the UI I was shown," Heins said of the new OS.
Reasserting RIM within the enterprise was also on Heins’ to-do list. Aware of the accelerating BYOD trend, he noted a need to boost the BlackBerry’s consumer appeal. But rather than RIM attaining that on its own, he said the company will continue to strengthen its core business offerings -- namely, security -- and reach out to third-party partners to ensure success among consumers.
"We are seeking strong partnerships that allow us to have the complete BYOD offering, but that doesn’t mean we have to do it by ourselves," he said.
Lastly, Heins disclosed plans for a thorough strategic review, where "no stone will be left unturned," designed to boost RIM’s operational efficiency. A new Chief Marketing Officer will also be onboarded. "The search for CMO is going well and we have met a number of excellent candidates and hope to have an update soon," Heins said.
RIM didn’t provide any specific figures related to its future outlook and first quarter guidance. Increasing competition, along with the BlackBerry brand’s shifting place in the market, makes these predictions to challenging to lock down, according to the company.
When asked if selling the company was one of the options being considered during RIM’s internal review, Heins said it’s not the path he would like to go down, but that he is open to any and all possibilities for reviving the floundering BlackBerry brand.
"If there is any element we detect during the strategic review, we would consider it [selling the company], but it’s not the main direction we are pursuing right now," he said.