It was no surprise that BlackBerry (Nasdaq: RIMM; Toronto: RIM) reported a loss for its first fiscal quarter of 2013. What did surprise analysts was RIM's announcement that its next product, the BlackBerry 10, will be delayed until next year.
RIM announced on Thursday revenue of $2.8 billion for the quarter, down from $4.2 billion the prior quarter and $4.9 billion in the comparable year-ago period. The company reported a net loss of $518 million for Q1 2013, compared with a net loss of $125 million the prior quarter and net income of $695 million in the year-ago period.
RIM also told analysts that BlackBerry 10, the product slated to reverse the company's fortunes, would be delayed due to software integration snags. In its earnings press release, RIM said:
Over the past several weeks, RIM’s software development teams have made major progress in the development of key features for the BlackBerry 10 platform; however, the integration of these features and the associated large volume of code into the platform has proven to be more time consuming than anticipated. As a result, the Company now expects to launch the first BlackBerry 10 smartphones in market in Q1 of calendar 2013.
According to Reuters and other media reports, analysts cut their price targets on RIM's stock and speculate that RIM could actually run out of cash:
At least 10 brokerages cut their price targets on the stock, some by as much as 50 percent, a day after the company reported worse-than expected quarterly results and said it would delay the launch of its next-generation device to early 2013 from late this year.
RIM shares were down 16 percent in pre-market trading on the Nasdaq.
"If RIM continues to be run as it is, we believe that the company will eventually fail," Nomura Equity Research said.
"We do not expect RIM to successfully drive a turnaround of its financials, even with the launch of BB10 next year," the brokerage said in a note to clients, adding that its model assumes that RIM disappears by 2020 in a gradual decline.
RIM also said it would be cutting 5,000 workers in an effort to save cash.
I think that might be true. Even with the BB App World, BB has not mustered the support it would have liked from its users. The apps and compatibility issues have been there for BB since a very long time. As a result, BB has developed into a product for a niche market, i.e. businessmen and working professionals.
Well I dont like BB becasue it is not that compatible for some reason to my reuirements. Its good for old fashioned bsiness people in my opinion but Apple is much more stronger in every aspect and IMO I feel its the best even when you compare it with the Samsung Galaxy 3
Jacob, thanks for your response. It might work out that way you mentioned but honestly I haven't seen it happen myself. Waiting to launch a product (that might not be able to compete with the others) at a time when the iPhone and SIII would have created a lot of hype doesn't seem workable to me.
We might have different opinions about this and only time will be able to tell which one is correct. Although, I hope that RIMS finds a way to get out of its troubles.
Syed, why can't be it in a reverse way also. They had already burned their hands by introducing different products at different stages. Nothing was fruitful, so they may wait for the right time to introduce a new product, through which they are expecting a good breath.
Jacob, I would have agreed with you if it were about a company that was doing good in the market. RIMS on the other hand is barely keeping up with the market. So I don't see what would they achieve by delaying and watching the competitors? Probably, by the time they react the competition would have already sliced up a huge chunk of their remaining market share.
I agree with the fact delays in launching announced products, in general, represent a bad situation; but if we think just a moment in terms of competitors, apart Apple, where RIM's competitors? Not to say I am a wizard, but maybe it is a good time for acquiring RIM at low price and for launching a new company, including a new brand...bad, sometimes, brings also good...
EBN Dialogue enables and encourages you to participate in live chats with notable leaders and luminaries. Not only editors and journalists, but the entire EBN community is able to comment and ask questions. Listed below are upcoming and archived chats.
Thailand Stages a Comeback Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Microsoft Surface: Potential Winners & Losers What are the implications for the electronics industry supply chain of Microsoft Corp.'s decision to launch its own tablet PC? Join industry veteran and EE Times' systems and OEM expert Rick Merritt on Tuesday, July 3, at 12:00 pm EDT for a Live Chat on this subject.
Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Peter Drucker famously said "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." Yet in the razor's-edge world of electronics—with a lean supply chain and just-in-time demands—the need to know the future is vital.
While no one really can accurately predict the future, we can take guidance from another Drucker saying which is the best way to predict the future is to create it.
You've heard the saying "the No. 1 supply chain risk is your people." That hasn't always been the case. But today's complex global supply chain requires a new type of multitalented employee. It's one who understands, finance, marketing, economics, is savvy with technology, graceful with relationships and can think analytically.
Where are these people? Are universities properly preparing the next generation supply chain professionals? How do train your existing workforce for these new, demanding positions?
Brian Fuller, editor-in-chief of EBN, will lead a 60-minute Avnet Velocity panel discussion that will ask and answer these and other questions swirling around today's supply-chain talent challenges.