TORONTO – Research In Motion (TSX:RIM) reported a second-quarter loss of US$235 million on Thursday as revenue plunged compared with a year ago, however the BlackBerry maker’s results were not as bad as many investors expected.
The Waterloo, Ont.-based company, which keeps its books in U.S. dollars, says the loss amounts to 45 cents per diluted share, compared with a profit of $329 million or 63 cents per share a year ago.
However excluding one-time costs, including cost cuts and job reductions, RIM posted an adjusted loss of $142 million or 27 cents per share.
Analysts had expected RIM to report a loss of about 47 cents per share, according to a poll from Bloomberg.
Revenue totalled $2.87 billion, down from $4.17 billion a year ago.
During the quarter, RIM said it shipped about 7.4 million BlackBerry smartphones and roughly 130,000 PlayBook tablets.
The results show that RIM is making progress as it transitions to its next generation of BlackBerry smartphones and completes its cost reduction plan, said chief executive Thorsten Heins.
“While this transition is challenging and the competitive environment tough, we have made steady progress in these areas in this quarter,” Heins said in a conference call.
“Our teams are very focused on maintaining a strong financial position as we go through this transition.”
The BlackBerry 10 operating system, he added, is on track to launch early next year.
Total of cash, cash equivalents, short-term and long-term investments stood at $2.3 billion at Sept. 1, up from $2.2 billion at the end of the previous quarter.
Cash flow from operations was approximately $432 million in the quarter, compared to $710 million in the first quarter.
RIM said it had 80 million subscribers at the end of the quarter, an increase of about 2 million from the previous three months.
Jeffries analyst Peter Misek said the results were better than he feared.
“Management sold more Blackberries than we thought,” he noted in an emailed response.
Shares in RIM jumped 15 per cent to US$7.14 in after-hours trading in New York. The company’s shares rose eight cents to close at $6.96 at the Toronto Stock Exchange on Thursday.
“Against low expectations, management did an excellent job in protecting and actually growing its two key strategic assets: its cash pile and its subscriber base,” said analyst Kevin Smithen of Macquarie Capital in an emailed comment.
In its outlook, RIM said it expects there will be continued pressure on operating results for the remainder of its financial year.
RIM anticipates to report an operating loss in the third quarter as it works through the transition.
The company has been pushing ahead with plans to launch its much-delayed BlackBerry 10 operating system and new smartphones.
The new devices and operating system are seen as the key to the company’s success after losing much of its market share to Apple’s iPhone and the Samsung Galaxy S3.
And while other companies debuted new devices, RIM was forced to push the launch of its BlackBerry 10 operating system and new phones into next year, missing the crucial back-to-school and holiday shopping seasons.
The company has also made significant reductions across its operations, closing facilities, severing ties with certain manufacturers and announcing plans to lay off 5,000 workers across its global operations in an effort to save $1 billion by the end of its fiscal year.
Thursday, September 27, 2012