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RIM Profits Dive As PlayBook Sales Stall

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Back in June, RIM reported profits which were well below analysts' expectations and last night’s earnings call reported similarly grim results for the last three months.

The big question technology watchers were looking for an answer to was how many BlackBerry PlayBook tablets the Canadian manufacturer had shipped. In the first quarter they were on sale, RIM shipped 500,000 units, but in the last three months the company only shipped 200,000 – how many of these were actually sold is still unknown.

RIM admitted that this figure was “lower than expected” but fought back by saying that the imminent PlayBook 2.0 software update (coming October) would bring a huge improvement to the tablet including native email, BlackBerry Balance, support for Android apps, a better browser, as well as new “consumer apps” which it hopes will “invigorate” the sales of the maligned tablet.

BlackBerry PlayBook

Overall RIM’s net profit fell by 58.7 per cent down to $329 million, from $797m in the same period last year. Revenue fell by 10 per cent to $4.2 billion.

In a worrying trend, inventories more than doubled at the Canadian company indicated that it is having trouble shifting its stock – though this is mostly down to the unwanted tablet rather than mobile phones..

Regarding phones, RIM recently had its biggest launch of BlackBerry handsets and on the back of this shipped 10.6m handsets in the quarter (down 2.6m compared to the same period last year) but expects a upsurge in phone sales in Q3 thanks to the new BB OS 7 devices such as the BlackBerry Bold 9900.

BlackBerry Bold 9900

"Overall unit shipments in the quarter were slightly below our forecast due to lower than expected demand for older models," said Rim co-chief executive Jim Balsillie

RIM is still developing its new QNX operating system for mobile phones and the other co-CEO, Mike Lazaridis, said the development was going “extremely well” but his claim that the BB OS7 will give them a “long runway” to get QNX right could suggest the company is having difficulties getting it working properly.

With shareholders and staff at RIM calling for changes at the top, the next set of results could be the last for the Balsillie/Lazaridis team as RIM tries to halt a rather worrying slide.

Source: RIM

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