The Death Spiral Of RIM Continues

If it wasn’t clear that RIM wasn’t already in deep trouble, it should be now. RIM released their Q3 report [Warning: PDF] yesterday and the results speak for themselves:

  • RIM made $5.2 billion last quarter while recording earnings of $1.27 per share, or $667 million. That was on reduced guidance.
  • RIM shipped 14.1 million smartphones in the quarter.
  • Net income dropped to $285 million from $911 million in the same quarter last year. That factors in the $485 million charge related to unsold PlayBook inventory in the third fiscal quarter.
  • Speaking of Playbooks. RIM only sold 150000 of them in Q3.
  • RIM has forecast EPS of between $0.80 and $0.95 in Q4 compared to Wall Street’s $1.08 expectation
  • RIM has forecast revenue of $4.6 billion and $4.98 billion compared to Wall Street’s $5.12 billion expectation.

In a bit of less than stunning news, RIM co-CEO’s Jim Balsillie and Mike Lazaridis will both take $1 salaries until the ship gets turned around. It’s not stunning because most of their compensation is likely in stock (albeit stock that has been hammered over the last year) which means that Balsillie is free to try and buy another NHL team at his leisure. The stunning news came in the announcement that RIM won’t be shipping their Blackberry 10 phones until the latter half of 2012. That my friends is a #fail because by then Apple and Google will be so far ahead of RIM, nobody will care what they come out with even if it is amazing from a tech standpoint.

Expect investors to whip out their Android or iOS phones and key in the word “sell” today.


Leave a Reply

%d bloggers like this: