RIM announces Q4 revenues miss, top executives leaving companyBlackBerry maker Research In Motion halted stock trades before announcing a billion dollar sequential drop in quarterly revenues substantially below its guidance on shipments of 11.1 million smartphones and a half million PlayBook tablets.
RIM had offered guidance of $4.6 to $4.98 billion in revenue for its fourth fiscal quarter (ending March 3), but only announced revenues of $4.2 billion, down 19 percent from $5.2 billion in the previous quarter.
The company announced a GAAP net loss of $125 million, with 11.1 million smartphones hitting the low end of its previous guidance (of 11-12 million BlackBerry smartphones) and down 21 percent from the previous quarter's shipments.
For all of fiscal 2012, RIM announced revenues of $18.4 billion, down 7 percent from 2011's $19.9 billion.
The company also announced pre-tax charges of $54 million related to a service interruption the company experienced in the third quarter last fall (which required service credits to affected users), and a $485 million "inventory provision" made for the poor selling PlayBook tablet.
Top executives exit
RIM also announced that former "co-chief executive" Jim Balsillie has resigned as a director of the company's board.
The company's chief technology officer David Yach and global chief operations officer Jim Rowan are also both leaving the company as well, leaving the company in need of a new COO.
No more guidance
Thorsten Heins, RIM's new president and chief executive, announced that the company would no longer provide "specific qualitative guidance" because it expects "continued pressure on revenue and earnings throughout fiscal 2013," and out of "a desire to focus on long term value creation and the current business environment."
"Some of the factors contributing to this," the company noted in a press release, "include ongoing weakness in the Companys U.S. smartphone business, an increased focus on selling BlackBerry 7 smartphones to grow the subscriber base in advance of the BlackBerry 10 launch, increasing competitive pressure in the Companys international markets and the introduction of certain new lower tier service pricing initiatives and a higher mix of sales coming from entry level products."
Heins noted that "the next few quarters will continue to be challenging for our business.
iPhone vs Blackberry
Back in the third calendar quarter of 2008, Apple's then chief executive Steve Jobs first announced that "Apple beat RIM" in quarterly sales, noting that "RIM is a good company that makes good products. And so it is surprising that after only fifteen months on the market that we could outsell them in any quarter."
After iPhone 3G sales peaked during its launch quarter, RIM's BlackBerry shipments again surpassed Apple, but iPhones continued to grow to the point where, in the third quarter of 2010, Jobs could announce, "We sold 14.1 million iPhones in the quarter, a 91% unit growth over year ago and way ahead of IDC's estimate of 64% growth for global smartphone market.
"It handily beat RIM's 12.1 million Blackberries sold in their last quarter. We've now passed RIM. I don't see them catching up with us in the foreseeable future. It will be a challenge for them to create a mobile software platform and convince developers to support a third platform."
While Apple and RIM report sales on staggered quarterly definitions, Apple most recently sold a peak quarterly total of 37 million iPhones worldwide, compared to RIM's 11.1 million BlackBerry shipments this quarter, and over 15.4 million iPads.