RIM posts strong quarter, beats estimates
BlackBerry maker reports an 84 percent increase in revenue, on the strength of its new smartphone devices. Company shares rise by double digits in after-hours trading.
Update at 2:09 p.m. PDT, with additional information from earnings report.
Research In Motion on Thursday posted a stronger-than-expected fiscal fourth quarter, with revenue climbing 84 percent over the same period a year ago.
RIM, the maker of the popular BlackBerry smartphones, reported revenue of $3.46 billion, up from $1.88 billion a year ago. Wall Street had expected the company to report $3.4 billion in revenue, according to Thomson Financial.
Net income jumped nearly 26 percent to $518.3 million, or 90 cents a share, for the fiscal fourth quarter, compared with $412.5 million, or 72 cents, a year ago. Analysts had expected the company to post earnings of 84 cents a share.
RIM's shares jumped by nearly 22 percent to $59.65 in after-hours trading. During the regular trading session, shares closed at $49.09, up nearly 8 percent.
Jim Balsillie, RIM's co-CEO, said in a statement:
We are very pleased to report another record quarter with standout subscriber growth that speaks volumes about the early success and momentum of our new BlackBerry products.
RIM experienced an extraordinary year in fiscal 2009, shipping our 50 millionth BlackBerry smartphone and generating $11 billion in revenue. Looking ahead into fiscal 2010, we see exceptional opportunities for RIM and its partners to leverage the investments and success of the past year to continue growing market share and profitability.
The company reported it gained a net 3.9 million new BlackBerry subscriber accounts. RIM also noted it shipped 7.8 million devices in the quarter.
During a conference call with analysts, RIM executives said half of the company's BlackBerry accounts are now made up of consumers, rather than the heavy slant toward enterprise customers the company has been known for.
Also, the executives pointed to strong sales of its recently introduced Storm as serving as a strong driver of sales and subscriber growth during the quarter. And one of the fastest growing regions for RIM is Latin America, such as Venezuela, Chile, and Brazil.
RIM issued a forecast for its current quarter, a move that fewer companies are doing these days as the economy is making visibility into future business uncertain. The company expects to post revenue of $3.3 billion to $3.5 billion in its fiscal first quarter that will end May 30. And it anticipates its earnings to be in the range of 88 cents to 97 cents a share.
The company also expects its first quarter to generate gross margins of 43 percent to 44 percent and its net subscriber accounts to 3.7 million to 3.9 million.
RIM, which has faced increasing competition from Apple's popular iPhone, recently has battled back on several fronts.
Late last year, the company introduced its first touch-screen BlackBerry, the RIM BlackBerry Storm, and this week announced its BlackBerry App World application store. Both take aim at Apple's iPhone, which was the first touch-screen smartphone and company to roll out its own smartphone application store.