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Friday, March 30, 2012
RIM Posts Loss, Considers New Business Plan
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Research In Motion posted a net loss and its first slump
in BlackBerry shipments for its holiday quarter. The company said Thursday that it is ready for a turnaround after failing to compete with flashier touch-screen phones such as Apple's iPhone and models
that run Google's Android software.
RIM said it will return to its roots and focus on
business customers, many of whom prefer BlackBerrys for
their security. RIM has had limited success trying to
enter consumer markets in recent years, and RIM CEO
Thorsten Heins said a turnaround required "substantial
change."
"We plan to refocus on the enterprise business and
capitalize on our leading position in this segment,"
Heins said. "We believe that BlackBerry cannot succeed if
we tried to be everybody's darling and all things to all
people. Therefore, we plan to build on our strength."
Also Thursday, RIM said former co-CEO Jim Balsillie has
resigned from its board. David Yach, chief technology
officer for software, and Jim Rowan, chief operating
officer for global operations, also are leaving in a
management shakeup.
The company said it would no longer issue financial
forecasts and was reviewing "strategic opportunities"
such as partnerships and joint-venture licensing, and
other ways to leverage its assets. The company expects
continued pressure on revenue and earnings throughout
fiscal 2013. "Due to a desire to focus on long term value
creation and the current business environment, RIM will
no longer provide specific quantitative guidance. Some of
the factors contributing to this include, ongoing
weakness in the company's U.S. smartphone business, an
increased focus on selling BlackBerry 7 smartphones to
grow the subscriber base in advance of the BlackBerry 10
launch, increasing competitive pressure in the company's
international markets and the introduction of certain new
lower tier service pricing initiatives and a higher mix
of sales coming from entry level products," RIM said in a
press statement.
RIM shipped 11.1 million BlackBerry smartphones in the
fiscal fourth quarter ended March 3, down 21 percent from
the third quarter. The Canadian company also sold more
than 500,000 PlayBooks in the fourth quarter, a number
inflated by deep discounts offered to boost sales of the
product. |
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