Market Currents
Mentioned during Research In Motion's depressing FQ1 call: 1) RIM says it will focus on...
-
Thursday, June 28, 2012, 6:11 PM ETMentioned during Research In Motion's depressing FQ1 call: 1) RIM says it will focus on developing fewer devices (logical, given the impact of massive job cuts on R&D). 2) RIM all but admits it will soon begin burning cash. 3) RIM says it's in a "good position on patents." That, together with the hiring of Verizon's General Counsel to be the company's new legal chief, could indicate RIM is looking for ways to monetize its patent portfolio. RIMM -15.1% AH.
Other date
TECH ETFs IN FOCUS
Latest Tech Articles
This news story has 17 comments:
When that comes up in an earnings call as a positive you know you are screwed.
Looks like the next Palm.
I mean, it is not like those people will break their cell contracts and get a new phone, just because they have to wait a few more months for the newest gadget.
Overhauling the OS? Delays only raise the capital investment and the expense level of the new devices which reduces margins.
The $2 Billion is nice and gives them some oxygen but they might need to fire everyone and just make it an asset sale if they cannot build and sell anything. That is they cannot compete.
Most of the developers they let go weren't switching over to QNX. What is the point of holding onto a bunch of developers making code for the OS that you are going away from?
@TomasViewPoint they just did a survey showing that the average app in the BlackBerry store makes more than the average app in iOS store, both blow out the Android store. Eventually developers will tire of Google's method of payment and want to be paid for their product and not the hopes of possible ad click revenue.
So what is your position? I just dumped my short position, are you backing up the truck?
Why would a developer make an app for RIM if they cannot sell phones and may be going out of business? Waste of time.
People were placing their hopes on BB10 to be the turnaround that they have hoped for... that leg just got knocked out from under them. Not only will they miss the critical holiday season and will fall behind their competition more, but they call into question their ability to execute and even to program. This loses the confidence of not only investors, but developers. Do developers want to spend months of work on apps to be run on products with an indefinite release and an uncertain future? What happens to them if RIM is bought or if BB10 is delayed further?
What's left? Their subscribers and their patents. I have questions about how valuable the patents are, but they aren't worthless, and neither are the subscribers. Thus, looking at this, the stool can't stand on two legs and so the fall will continue, but there is some value present. My guess is that the cash will get burned away and the rest will be worth somewhere north of 5...but that doesn't mean that the stock won't dip temporarily lower. Of course, 5 isn't all that far to go, being that we are at 7 and we were in the 60's last year...
Right now this company is moving from one conference call to another and a lot of chatter about BB10 which is not a strategy. In fact with it being late it may be behind the curve even further as Apple can raise the bar on them and bury them by next year.
You would think so, but that isn't how these train wrecks work....the mess at HP shows that the top can be pretty chaotic and confused... Actually Tomas actually thought about this carefully before going long RIMM....and it saved a lot of money and misery....that's what good investors do, investigate with eyes wide open....
"Wouldn't the delay result in. A better product and more sales?"
When we call it a delay, we are saying that they needed to produce a complete, quality product....on time....
By burning more time you do three things: burn profits because of your aging product line, lose customers and market share, try the patience of your shareholders....
Don't think so?....see what happens and what shareholders do if you delay again.....you think they will say, "well, it's okay, they will have a better product as a result"? No, they will head for the exits....like many of you should have a long time ago....
....a handful of you will just dig in your heels and continue justifying as the disaster continues because that it's off coming to terms with the pain that comes with admitting to yourself that you were wrong....not realizing that quickly recognizing when you are wrong is one of the pillars of becoming an effective investor....
It does not appear you have worked in high tech or have paid attention to tech companies that cannot execute. The case studies are all around. Do some research. You might learn something.
Beyond the research I know these problems intimately at a number of companies. That is I have lived it. You have no idea how hard it is to turn around and founders can be the biggest problem.
Delays are never good but can be managed if they are short and/or if the company is in an unassailable position. That does not describe RIMM.