RIM Profits Dive As PlayBook Sales Stall

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

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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