Last month Canadian smartphone and tablet manufacturer, Research In Motion (RIM), announced poorer than expected financial results for Q1 2011. It also hinted at jobs cuts as a result, and today has confirmed it will cull 2,000 jobs – representing 11 per cent of its workforce.
Details of how much the job losses and redundancy will cost and other operating reductions won’t be known until RIM publishes its second quarter results, which are expected on 15 September.
With RIM going through a transition phase at the moment, as it attempts to transfer its smartphone range to the QNX platform, it is facing considerable pressure from shareholders – and indeed its own staff – to radically overhaul the structure of the company. The most pressure is coming on co-CEOs Jim Balsillie and Mike Lazaridis with shareholders calling for one or both to step down.
In a statement issued this morning, RIM said the job cuts are part of its cost optimisation program, which it said is focused on "eliminating redundancies and reallocating resources to focus on areas that offer the highest growth opportunities and alignment with RIM's strategic objectives."
With a reduced workforce, under-pressure CEOs, flagging sales and an outdated line-up of handsets, RIM is going through more than just a transition period at the moment, it is walking a tightrope and hoping to just survive this difficult period.
Source: Wall Street Journal