Research In Motion stock plunges on weak sales

September 17, 2011 | 08:29

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Shares of Research In Motion (RIM) plunged 19 per cent on Wall Street on Friday after the BlackBerry maker reported sales and profits that fell short of expectations.

The Waterloo, Ontario-based company reported an outage meanwhile with its BlackBerry Messenger (BBM) service in Canada and Latin America.

"Some Canada & LatAm customers report BBM issues," RIM said in a message on its @BlackBerryHelp Twitter feed. "Our support teams are investigating. We apologize for any inconvenience."

RIM shares lost 18.99 per cent on the Nasdaq stock exchange to close at $23.93.

RIM had a market capitalization of more than $30 billion at the start of the year, but the latest declines have reduced its value to around $12 billion.

RIM said Thursday that net profit fell to $329 million, or 63 cents per share, in its fiscal second quarter from $797 million, or $1.46 per share, in the same quarter a year ago.

Revenue declined to $4.2 billion in the quarter which ended on August 27 from $4.6 billion a year ago.

RIM, which is facing stiff competition from Apple's iPhone and handsets running Google's Android software, said it shipped 10.6 million BlackBerry smartphones during the quarter and 200,000 PlayBooks, RIM's rival to the iPad.

Analysts had expected BlackBerry shipments of 11.9 million units and 700,000 PlayBooks.

During a conference call with analysts Thursday, RIM co-chief executive Mike Lazaridis said the "past few quarters have been challenging," but expressed confidence the company is "on track to return to growth in the third quarter and beyond."

RIM said it expected BlackBerry shipments to grow between 27 per cent and 33 per cent in the third fiscal quarter over the second quarter, to between 13.5 million units and 14.5 million units.

RIM did not provide a forecast for PlayBook shipments.

AFP

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