RIM delivers solid Q4 results on BlackBerry sales
Published: 03 Apr 2009 09:28 BST
Research In Motion reported strong fourth-quarter earnings that beat Wall Street's expectations and sent shares soaring in after-hours trading.
For the quarter ending 28 February, the company reported net income of $518.3m (£352m), or 90 cents per share, on $3.46bn in revenue. Analysts polled by Thomson Reuters had been expecting earnings of 84 cents a share on revenue of $3.4bn.
RIM projected earnings per share of 88 cents to 97 cents in the first quarter, a projection that provides ample upside to estimates of 82 cents a share. Revenue for the first quarter was projected to be $3.3bn to $3.5bn compared to estimates of $3.5bn.
For the fiscal year, the company reported net income of $1.89bn, or $3.30 per share, on $11.07bn in revenue.
The company said it added about 3.9 million net new BlackBerry subscriber accounts, bringing the total to about 25 million. Among the contributing factors was the buy-one-get-one-free promotion through Verizon Wireless. In addition, the company ramped-up inventory on the long-awaited Storm, a touchscreen Blackberry to rival Apple's iPhone.
The company said in March that it had record net subscriber additions throughout December and after Christmas, but that the surge will become "more normalised" in the first quarter. On a conference call with analysts, co-chief executive Jim Balsillie said that about 70 percent of the devices activated in the quarter were for non-enterprise customers. Today, the ratio of enterprise to non-enterprise customers is about 50-50.
In particular, the Storm "has clearly opened up a new market segment", and it "drove record levels" of new subscribers. The Storm's reach is being expanded and it is now available in other countries, specifically Canada and emerging markets in Brazil, Hong Kong and India. In addition, the company noted the overall strong growth in Latin America, specifically Venezuela, Chile and Brazil.
Looking forward, the company highlighted the launch of its app store on Wednesday — a move that follows Apple's success with applications for the iPhone and iPod Touch — and noted that the store will see additional applications in it over time.
The company projects first-quarter revenue to be in the range of $3.3bn to $3.5bn, EPS of 88-89 cents per share and a gross margin of 43-44 percent. It expects net subscriber additions to be between 3.7 million and 3.9 million and units shipped to be between 7.5 million and eight million.
In a statement, Balsillie said: "We are very pleased to report another record quarter with standout subscriber growth that speaks volumes about the early success and momentum of our new BlackBerry products. RIM experienced an extraordinary year in fiscal 2009, shipping our 50 millionth BlackBerry smartphone and generating $11bn in revenue."
Shares were up more than seven percent in regular trading, closing at $49.09, but soared in after-hours trading, jumping more than 22 percent.
Credit: RIM delivers solid Q4 on BlackBerry sales; shares soar from ZDNet.com
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