updated 04:40 pm EDT, Thu June 16, 2011
RIM spring 2011 results show 500K PlayBooks
RIM on Thursday reported a "challenging" quarter that saw a relatively optimistic start for the BlackBerry PlayBook but a crash in its phones and threatened job cuts. The company shipped 500,000 PlayBooks in its spring quarter, or twice as many tablets as Motorola did with the Xoom in its own most recent period. However, BlackBerry phone sales collapsed dramatically in the same period, falling from 14.9 million in winter to just 13.2 million in the spring.
Revenue was up 16 percent to $4.9 billion, but profit was down to $695 millino versus $769 million just a year ago.
It was a poor start to the company's fiscal year, co-chief Jim Balsillie said. He contended that a "slowdown" that had started in the winter had spilled over into the spring. He also admitted that RIM had had to delay the BlackBerry Bold 9900 and that it wouldn't ship until "very late" in August. Future products in the next few months would help the company bounce back, he insisted.
RIM's product roadmap for 2011 has been widely leaked and includes a high-end replacement for the Storm2 known as the BlackBerry Volt.
The outlook for the summer was bleak. RIM now expected revenue to drop to between $4.2 billion to $4.8 billion and for its profit to be roughly half of what it was in the spring. It planned to undertake a "headcount reduction" of an unknown number of workers to focus on faster-growing areas and get back to timely phone launches, which have been regular problems. Any cuts would take place in the current quarter and would show their impact in the next.
RIM's shortfall in phones is likely to see its market share plunge sharply in the US. Its closest American rival, Apple, shipped 18.65 million iPhones in the winter and won't necessarily see its shipments drop with the spring, results of which should come next month. Apple is now known to have outsold RIM for at least three quarters and may now have an insurmountable lead, particularly in the US.