Research In Motion reduced their profit forecast 2 months ago however they showed earnings results yesterday that were worse than even the lowered analyst expectations.
RIM are one of the pioneers of the smartphone market, making one of the first smartphones ever released. In recent years however they are struggling to maintain percentages of the market while Google and Apple handsets thrive. Additionally, the release of the Playbook Tablet this spring has been met with a lukewarm critical response although they managed to ship 500,000 units to retailers. The tablet software has issues and there are several important missing features. RIM have not yet set a release date for the new operating system and they also have not posted sales figures for the Playbook, even though they shipped a healthy number to the channel.
RIM predicted they would earn $5.25 to $6 a share down from the earlier forecast of $7.50 a share. Their revenue forecast was reduced to $4.2 billion, from $4.8 billion. RIM announced that their profit during Q1 fell 9.6 percent to $695 million, or $1.33 a share. This shows a huge decline on last year, when they reported a profit of $769 million.
The news sent RIM’s shares falling 14 percent in after hours trading on Thursday.
James L. Balsillie, the companies co-chief executive said that he expects the situation to improve. “We have a strong business. We have made major platform upgrade. We are almost through this transition.”