RIM Expects Decrease In Profit, Increase In Subscribers


Research In Motion said Wednesday that its fourth-quarter earnings and gross margin would be at the low end of its previous forecast range, despite subscriber additions exceeding expectations. In addition, RIM expects revenue for the quarter to be at or near the midpoint of the previously guided range. Gross margin and earnings per share for the quarter are expected to be at the low end of the previously guided ranges.

On Dec. 18, RIM forecast revenue for the quarter of $3.3 billion to $3.5 billion, with profit of 83 to 91 cents a share. It also projected gross margin for the quarter of 40 percent to 41 percent.

RIM said it expects net subscriber account additions for the fourth quarter to be more than 20 percent higher than the 2.9 million net subscriber account additions forecast by RIM on Dec. 18. RIM had record levels of net subscriber account additions throughout the month of December.

In a statement, RIM said a number of factors, including product mix, lowered channel inventory levels and an increased ratio of new subscriber sales to upgrade and replacement sales, are contributing to the degree of performance in subscriber growth relative to revenue and earnings performance within the quarter.

RIM is slated to report actual fourth-quarter net subscriber account additions and fourth-quarter financial results, and offer guidance for the first quarter of fiscal 2010, on April 2.