RIM earnings high than expected, company pins hopes on BlackBerry 10
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Research In Motion Ltd reported a narrower-than-expected loss on Thursday and the struggling BlackBerry maker said it increased its cash pile, a hopeful sign for the launch of its make-or-break line of revamped smartphones next year.
Shares of RIM rose more than 15 percent as investors were encouraged by indications the company will have sufficient cash to push ahead with a robust marketing campaign of its next-generation BB10 devices, due out in early 2013.
In another rare ray of optimism for the embattled company, RIM posted a loss that was smaller than expected and it generated more revenue than forecast.
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“It’s still bad, but it’s a much smaller disaster than expected,” said Sterne Agee analyst Shaw Wu. “These stocks all trade on expectations. Expectations were really low, and they were able to beat that.”
The company has staked its future on BB10. A one-time smartphone pioneer, RIM has failed to keep pace with innovations by rivals such as Apple and Samsung. RIM’s share price has tumbled about 70 percent over the past year as the BlackBerry’s market share tumbled.
The Waterloo, Ontario-based company reported a net loss of $235 million or 45 cents a share, in its fiscal second quarter, ended Sept 1. That compared with a profit of $329 million, or 63 cents, in the same period a year earlier.
Excluding one-time restructuring-related items, the loss came in at $142 million, or 27 cents a share, in the quarter just ended.
Revenue rose to $2.9 billion, or 2 percent from the fiscal first quarter, but the latest result was down about 30 percent from the same period a year earlier.
Analysts, on average, had expected RIM to reported a loss of 46 cents a share, on revenues of $2.5 billion, according to Thomson Reuters