RIM profit jumps in second quarter
BlackBerry maker says quarterly profit was up 57 percent as revenue from subscriptions rose.
Net earnings for the period were $111.1 million, or 56 cents per share, in the quarter that ended on Aug. 27. Earnings adjusted for an inventory write-down and incremental warranty item, as well as for an expense of $6.6 million related to its NTP litigation, were 61 cents per share. That compares with net earnings of $70.6 million, or 36 cents per share diluted, in the same period last year.
Analysts expected Waterloo, Ontario-based RIM to earn 61 cents per share, according to a survey by Thomson First Call.
RIM said its revenue was $490.1 million, up 8 percent from $453.9 million in the previous quarter and up 58 percent from $310.2 million in the same quarter of last year.
The company's BlackBerry mobile devices and messaging service provides always-on wireless access to e-mail and corporate data. The revenue breakdown for the quarter was approximately $343 million (70 percent) from its BlackBerry handhelds, $88.2 million (18 percent) from wireless service, $39.2 million (8 percent) from software and $19.6 million (4 percent) from other business.
Approximately 620,000 BlackBerry subscribers were added in the quarter, RIM said, bringing its membership base to approximately 3.65 million.
At the close of regular trading, RIM shares were down 18 cents to $77.25. The earnings report was issued after the close of regular trading. In after-hours trading, RIM shares dropped $3.14, or 4.06 percent to $74.11, on word that subscription levels were light in the summer season, especially in Europe.
Jim Balsillie, co-chief executive at RIM, said he now expects the company to surpass $2 billion in annual revenue and the 5 million subscriber milestone before the end of the fiscal year.
"We are entering the second half with solid market positioning, strong momentum and an impressive line-up of new products and services." Balsillie said.
The earnings report comes a day after the mobile device maker announced it will use Intel XScale processors code-named Hermon in its future designs.
In addition, RIM said Wednesday that it has signed a deal with Cingular to provide the carrier with its BlackBerry Connect software for the Nokia 9300 in the United States.