Jim Balsillie and Mike Lazaridis resign their positions in the beleaguered company as profits decline and investor disappointment grows.
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Research In Motion's co-chief executives have resigned their positions as part of a management shuffle, the company announced this evening.
Jim Balsillie and Mike Lazaridis, who will also relinquish their positions as co-chairmen, are stepping aside to allow Thorsten Heins, currently one of the company's chief operating officers, to become chief executive, effective immediately.
"There comes a time in the growth of every successful company when the founders recognize the need to pass the baton to new leadership," Lazaridis said in a statement. "Jim and I went to the Board and told them that we thought that time was now."
Heins, who was also named to RIM's board of directors, joined RIM in December 2007 as senior vice president for hardware engineering and became chief operating officer for product and sales in August 2011.
Lazaridis has become vice chair of RIM's board and chair of the board's new Innovation Committee. Balsillie remains a member of the board. RIM said that it has named Barbara Stymiest, who has been a board member since 2007, has been named the independent board chair.
The move comes in the face of lost investor confidence in the pair over the last year. The company's downward spiral was highlighted last month when the company announced declining profits and revenue in the third quarter. For its fiscal third quarter, the Canadian mobile devices maker reported a profit of $265 million, or 51 cents a share, compared with a year-earlier profit of $911.1 million, or $1.74 a share.
Complicating things for the duo was the company's announcement that it didn't plan to release its next-generation BlackBerry phones until the latter part of this year, creating a huge void without any products.
The pair were rumored earlier this month to be close to relinquishing their titles as co-chairmen. While some investors had been calling for a complete ouster of Balsillie and Lazaridis, the move to replace them as co-chairmen was seen as possibly helping to help assuage some concerns that the two had too much control over the company.
RIM said at the time that a committee of independent directors was reviewing the company's governance structure and would report its findings by January 31.
Over the past year, the beleaguered company has seen its market share erode and stock price plunge after several critical miscues--in that time, the stock has lost more than three-quarters of its market value, prompting growing shareholder criticism and calls for a change in management.
Balsillie and Lazaridis, who are the second and third largest shareholders in the company, were at the helm as RIM suffered a sharp slowdown in growth this year. RIM's latest wave of BlackBerry smartphones have barely made a dent in a market that also includes the iPhone 4S and a wave of Android smartphones, and its attempt to breach the tablet market with the PlayBook also stumbled early.
The company is also facing a possible class action lawsuit in Canada after a global service outage struck BlackBerry customers last October. The outage, the worst in the company's 12-year history, began October 10 when the company's e-mail, messaging, and Web service went down across the world, starting in Europe, the Mideast, and Africa and eventually spreading to the U.S. and Canada.
Service was restored on October 13, and RIM offered its customers $100 worth of premium apps for free--an overture that many criticized as insufficient.