RIM (RIMM) -15.3% as trading resumes, after handing in guidance far short of expectations....

RIM (RIMM) -15.3% as trading resumes, after handing in guidance far short of expectations. "Delays in new product introductions into the very late part of August [is] leading to a lower than expected outlook" in Q2. Also: Unit sales of 13.2M were below already reduced forecast for 13.5M-14.5M; launch of “a program to streamline operations... which will include a headcount reduction.”

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Comments (13)
  • Joe Morgan
    , contributor
    Comments (1608) | Send Message
    Horrible numbers coupled with incompetent management means the company future is bleak....


    16 Jun 2011, 05:02 PM Reply Like
  • Tack
    , contributor
    Comments (16552) | Send Message
    It doesn't matter what management does because the issue has already been decided in the operating-system wars, and, there, Apple and Google have won. Nokia is dead meat, too. Even Microsoft, with all its might, is swimming decidedly upstream and may fail outright.


    Basically, the game is over for RIMM and Nokia, in so far as their proprietary platforms go.
    16 Jun 2011, 05:14 PM Reply Like
  • RK
    , contributor
    Comments (399) | Send Message
    I think there is room for three mobile OSes: iOS, Android, and Windows. All because they are backed by very deep pocket companies. QNX, as number four, will have a hard time getting developer attention. This strategic problem for RIMM was obvious three years ago and it remains an unresolved problem today.
    16 Jun 2011, 11:59 PM Reply Like
  • Teutonic Knight
    , contributor
    Comments (3960) | Send Message
    RIMM may claim to be 'technically superior'; but who cares? In this game, momentum and outlook are more important. Remember, this is not as it is in engineering school.
    16 Jun 2011, 05:26 PM Reply Like
  • Schen1301
    , contributor
    Comments (99) | Send Message
    RIMM is KAKA. What can they do to avoid following NOKIA's foot step? It is time to stay short now.
    16 Jun 2011, 05:50 PM Reply Like
  • Herr Hansa
    , contributor
    Comments (3134) | Send Message
    Share buybacks start after 10 July and run for 12 months, with the company able to buyback up to 5% of shares. Biggest negative is missing back-to-school promotions due to new product delays. I would expect flat to under-perform for the shares over the next two quarters.


    The difference to Nokia is that they are ahead on platform software development. Nokia is Research In Motion's (RIMM) main competition currently, because both companies sell a large percentage of their phones outside of the US market. Windows Phone might get a marketing boost, whereas RIMM needs carriers to provide marketing; they are the David amongst Goliaths.
    16 Jun 2011, 06:10 PM Reply Like
  • tiger8896
    , contributor
    Comments (746) | Send Message
    Rimm is seriously behind the eight ball, those product delays are for products that shouldn't come to market by and large. Who wants another iteration of a Blackberry OS phone and the future of QNX phones whether they can compete with IOS and Android is a real question when they come out. I see further market share losses for Rimm and if they can't come up with some products that people want to buy then Rimm investors are looking at a $10-20 stock.
    16 Jun 2011, 06:13 PM Reply Like
  • Herr Hansa
    , contributor
    Comments (3134) | Send Message
    Just curious, go ahead and describe a phone you think they should bring to market. Just for fun. :-)
    16 Jun 2011, 06:26 PM Reply Like
  • Poor Texan
    , contributor
    Comments (3527) | Send Message
    "which will include a headcount reduction.”


    I believe this is the third big tech firm to talk about headcount reductions. Ought to be good for employment growth.
    16 Jun 2011, 07:33 PM Reply Like
  • dividend_growth
    , contributor
    Comments (2894) | Send Message
    Those RIMM pumpers on SA are eerily silent....
    16 Jun 2011, 10:15 PM Reply Like
  • Chris Lau
    , contributor
    Comments (4284) | Send Message
    A couple of comments:
    1. share buyback is an inconsistent strategy to increasing r&d spend and laying off staff
    2. COO medical leave a mystery: can they get someone with a strong background in retail to manage tablet sales?
    3. My EPS 2012 estimate is consistent with what management provided. $5 ($4-6 given)
    4. 2013 and 2014 forecast already includes drastic drop in earnings
    5. How will staff reduction help company speed up development of mid- and high-end product? Are they going to cut support for the very old models (running OS 4.7x?) Why not run a promo of some sort to get unhappy users on at least the curve and OS 6?


    Bottom line:
    Just how much risk is there for execution of the new product roadmap? 2012 will see larger market share loss (given rate of growth of android/iphone). WP7/Nokia will also be released then. Mango looks great. The WP7 may even be competitive in the corporate space, though unlikely...but definitely in the consumer space.
    16 Jun 2011, 10:49 PM Reply Like
  • Herr Hansa
    , contributor
    Comments (3134) | Send Message
    There were a few details this week on some of these. I agree that the share buyback is inconsistent with some other moves. The EPS estimate considers roughly the same Q2, which implies improvements in Q3 and Q4; possible with new products (phones) coming out then. I don't think even Gartner Group are confident enough to show a decline for RIMM in 2014, though they did predict a plateau for iPad sales for Apple; is anyone really that long on RIMM shares for that to matter, because the next 3 quarters are the important part.


    Profit is still at 43% though projected to decline to 40% in following quarters, which is good though implies better sales in lower priced phones and rest of world (outside US) sales. Where they are not really addressing is the high end, which might impress reviewers and that small segment of phone buyers.


    The staff layouts were expanded upon this week in that support for devices prior to BB 5 will be slowly discontinued, and much of the Java development team will see the reductions. That comes from another development company, so I'm not entirely certain of the accuracy of that, but it sounds like the right thing to do.


    So far only HTC are really generating profits from Android, despite that it is becoming the dominant smart phone platform. There is the marketing power of Google behind that. Windows Phone 7 will have the marketing power of MicroSoft behind it, without much need for Nokia to do much more, though as I understood that Nokia is not getting an exclusive on the software. That leaves only Apple with iOS and Research in Motion with QNX as in-house software and hardware development. Basically RIMM copies AAPL, but lacks the marketing power. RIMM will never have the number one spot in market share, but as other profitable companies prove, being at the very top is not necessary for profits. RIMM should continue to do better than many phone manufacturers, just not Apple, but they need to finish the changes they started.
    17 Jun 2011, 02:11 AM Reply Like
  • ShashNanda
    , contributor
    Comments (54) | Send Message
    "Basically RIMM copies AAPL, but lacks the marketing power"


    I think people still do not understand that you can not sell crappy products with great marketing!
    17 Jun 2011, 04:01 AM Reply Like
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