Research In Motion (RIM) earnings update: Expectations disappointing
We reported earlier that Research In Motion (RIM) 4th quarter results would take a large jump, with 24 per cent sales growth and 41 per cent profits, well these expectations are disappointing.
According to Reuters RIM shares has taken a fall as mobile phone sales disappoint, Asian market shows that RIMS profit rose to $710.1 million, which is $1.27 a share, and in 3-months ending February 27 from $628.4 million, or $1.10 a share in the same period as last year.
Shipments were disappointing and this could possibly be why rivals Apple iPhone and Motorola Droid started to gain traction with consumers, however RIM’s revenue did increase 18-percent to $4.08 billion.
Reuters also report that 45 percent gross margin exceeded expectations of 43.5 percent, which means pasts concerns of lower priced handsets would pull down profitability. For the upcoming fiscal first quarter, RIM said it hopes that earnings per share would be $1.31 to $1.38 and revenue of $4.25 billion to $4.45 billion. They are hoping that they can add around 4.9 million and 5.2 million subscribers and have a gross margin of 44.5 per cent.
Research in Motion U.S listed shares dropped 6.7 percent in extended trade on Wednesday after the BlackBerry maker posted its results.