WATERLOO – Research In Motion (RIM) reported revenue of $2.7-billion (U.S.) and an adjusted net loss of $114-million for its third quarter results. Its global user base slipped about another 1 million to 79 million, but it managed to increase cash flow by $600 million to $2.9 billion ahead of its crucial January 30, 2013 launch of its BlackBerry 10 smartphones.
Revenue for the third quarter of fiscal 2013 was $2.7 billion, down 5% from $2.9 billion in the previous quarter and down 47% from $5.2 billion in the same quarter of fiscal 2012. Analysts were expecting sales of about $2.7-billion and an adjusted net loss of $188-million.
The revenue breakdown for the quarter was approximately 60% for hardware, 36% for service and 4% for software and other revenue. During the quarter, RIM shipped approximately 6.9 million BlackBerry smartphones and approximately 255,000 BlackBerry PlayBook tablets.
GAAP net income for the quarter from continuing operations was $14 million, or $0.03 per share diluted. GAAP net income for the quarter, including loss from discontinued operations, was $9 million, or $0.02 per share diluted, compared with the GAAP net loss of $235 million, or $0.45 per share diluted, in the prior quarter and a GAAP net income of $265 million, or $0.51 per share diluted, in the same quarter last year.
"RIM continued to execute on its product roadmap plans and to deliver on key financial metrics as it gets set for the global launch of BlackBerry 10," said Thorsten Heins, President and CEO. "During the third quarter, we continued to demonstrate our strong financial position, generating $950 million in cash flow from operations, and increasing our cash position significantly to more than $2.9 billion. More than 150 carriers are currently completing technical acceptance programs for the first BlackBerry 10 products, and beta trials of BlackBerry Enterprise Service 10 are underway at more than 120 enterprises including 64 Fortune 500 companies. This is an exciting time and our carrier partners, application developers and employees are all looking forward to unveiling the innovation and excitement of BlackBerry 10 to our customers on January 30, 2013."
RIM says it expects that there will be continued pressure on operating results as it gets set to launch its BlackBerry 10 platform in the fourth quarter. The company intends to continue to consider using pricing initiatives on BlackBerry 7 devices and service fees in some markets as a way to maintain our subscriber base and drive more BlackBerry users.
It adds that the timing of the BlackBerry 10 launch event for January 30, 2013 could also impact sales of current BlackBerry 7 products as some customers may defer purchasing decisions and wait for BlackBerry 10 devices. All these factors are expected to impact unit volumes, subscribers, margins and service fees. In addition, RIM says it will significantly increase its marketing spending this quarter to support the global launch of BlackBerry 10, and the company expects to report an operating loss for the fourth quarter.
RIM also announced that Robin Bienfait, Chief Information Officer for RIM is retiring at the end of this year following six years at the company. Apparently he will continue supporting RIM in an advisory capacity to “enable a smooth launch and seamless transition.”
Under Bienfait’s watch, the BlackBerry service infrastructure has grown from 47 petabytes per year to more than 33 petabytes per month at the same time as the internal corporate infrastructure for RIM has grown at a remarkable pace. He joined RIM in the beginning of 2007 with the mandate to take RIM's BlackBerry data services infrastructure from a single presence in Canada to a distributed model connecting to over 650 carrier partners worldwide.
In addition, over this past year, Bienfait has led RIM's Enterprise business unit focused on enabling services for Enterprise customers and preparing for the launch of the BlackBerry 10 platform.
