Research in Motion Shares Slip 8% After-hours on Dim Outlook
Research in Motion issued disappointing quarterly results after the closing bell on Thursday, as expected, but unexpectedly dropped a dismal outlook for the current quarter, sending its shares down more than 8 percent in after-hours trading. The maker of the Black Berry OS for mobile devices said it expects to earn between 85 and 95 cents a share in the current quarter on revenue of between $4.6 billion and $4.9 billion, falling well short of analysts projections of $1.16 per share in earnings on revenue of $5.1 billion.
Further disappointing investors, RIM said it expects to ship just 11 to 12 million Black Berry phones this quarter, barely above the number it shipped in the fourth quarter of 2010. Furthermore, the company announced that it would not be ready to launch Black Berry 10, the new version of its software that is viewed by analysts as the cornerstone of its chances to make a comeback, until late next year because of delays in the development of a special chipset needed for the OS.
Shares of RIM fell nearly 8 percent in after-hours trading as investors were spooked by the company’s dim outlook. The company blamed its bad performance last quarter on weak demand for its PlayBook tablet and the high profile service outage that affected Black Berry users last month. The lone bright spot in the report was perhaps the overall growth in RIM’s userbase, which expanded 35 percent from a year ago to 75 million at quarter’s end.