RIM shares pounded on subscriber worries

2012-12-22 10:21

Multimedia   ·   User Galleries   ·   News in Pictures Send us your pictures  ·  Send us your stories

New York - Shares of BlackBerry maker Research In Motion plummeted on Friday on the Nasdaq exchange on investor fears that its new smartphone platform will thin the ranks paying for its service.

RIM's stock price lost more than a fifth of its value after the opening bell in New York, plummeting to $11.15 a share by late afternoon.

The decline came a day after the Canadian company reported its first-ever decline in smartphone service subscribers, with the number slipping by a million to 79 million in the fiscal quarter that ended December 1st.

Analysts and investors are worried that RIM might lose even more subscribers after it rolls out a new BB 10 platform and touch-screen smartphones to stop Apple iOS and Google Android from devouring the mobile gadget market.

The success of the long-awaited BB 10 platform set to launch in January is seen as key to preventing RIM smartphones and tablets from becoming footnotes in the age of tapping into the Internet on the move.

While touch-screen smartphones might be more in tune with people's tastes than the trademark BlackBerry keyboards, the BB 10 platform makes subscribing to the company's profitable service optional.

Companies using the current BlackBerry platform pay monthly fees for handsets to be part of a RIM network known for security so high that some governments have complained of being unable to pry into email messages.

Service fees reportedly made up more than a third of the revenue taken in by RIM in the recently-ended quarter.

The new platform

In an earnings call with analysts on Thursday, RIM executives said that BlackBerry service fees would be "under pressure" with the new platform and declined to speculate how it would play out.

National Bank Financial analyst Kris Thompson expected investors to "punish" RIM shares until the company provided better guidance regarding how the new platform would affect profits.

RIM on Thursday reported a small profit after three consecutive quarterly losses, offering some optimism for the struggling smartphone maker.

The firm posted a net profit of $9m in the quarter.

That profit compared with a loss of $235m in the second quarter and a gain a year ago of $265m.

Revenue for the quarter was $2.7bn, down five percent from $2.9bn in the previous quarter and a slump of 47% from $5.2bn in the same quarter of fiscal 2012.

The results were better than most analyst predictions.

The new BB 10 platform is to be launched on 30 January, and is seen as the last hope for Ontario-based RIM to regain some of its former luster.

A report by IHS iSuppli this week said BlackBerry will see its market share fall to 5% in 2012, from 11% in 2011.

Read more on:    rim  |  blackberry  |  mobile
NEXT ON NEWS24X
SHARE:

Read News24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
19 comments
Add your comment
Comment 0 characters remaining
 

Inside News24

 
/News
 

The most epic YouTube mashup of 2014

Try to see how many of these things gone viral you recognise in this epic mashup YouTube video!

 
 

I love summer.24

Summer Survey!
Stay in shape this summer
Ultimate fails compilation 2014
This sleeping bulldog is you during the holidays

Jobs in Cape Town [change area]

Property [change area]

Travel - Look, Book, Go!

Kalahari.com - shop online today

Grand Theft Auto 5

Now available on PS4, Xbox One and PC from R649. Buy now!

Festive gifts!

Check out our awesome range of festive gifts to make everyone’s wishes come true. Shop now!

Save on Samsung

Cameras, mobile phones, TVs, Tablets and more. While stocks last. Shop now!

Save up to R2200 on electronics! – As seen in the catalogue

Wishing for tech gadgets this festive? Save up to R2100 on hot tech products at kalahari.com. While stocks last. Shop now!

30% off the bestselling books

Save big on the most captivating reads of 2014. While stocks last. Shop now!

OLX Free Classifieds [change area]

Samsung Galaxy s4

Mobile, Cell Phones in South Africa, Western Cape, Cape Town. Date October 24

Best bargain in big bay

Real Estate, Houses - Apartments for Sale in South Africa, Western Cape, Cape Town. Date October 25

VW Golf 6, 1.6 Trendline (Excellent condition)

Vehicles, Cars in South Africa, Western Cape, Cape Town. Date October 25

Horoscopes
Aquarius
Aquarius

You are in an innovative mood and may want to break out and do your own thing today. The Moon moves into Aries which emphasizes...read more

There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.








Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.