Research in Motion Destroyed After Q1 Earnings Results; Blackberry 10 Delayed!
Spiraling Blackberry-maker Research in Motion (NASDAQ: RIMM) released its fiscal first-quarter earnings results on Thursday after the closing bell. In what has become a quarterly tradition for the company, the stock is getting decimated in the after hours after another disastrous report.
The company reported earnings per share of $0.37 on revenues of $2.8 billion. This compares to Wall Street analysts' consensus EPS estimates of a $0.01 loss on revenues of $3.08 billion. Revenues were down a whopping 43% versus last year's corresponding quarter.
When including a pre-tax charge of $335 million for impairment of goodwill, Research in Motion reported a loss of $0.99.
Gross margins in the quarter plunged to 28% compared to 43.9% last year.
The company said that it expects another operating loss in the third quarter and that the next several quarters will be very challenging.
In even worse news, the company said that its launch of Blackberry 10 will not begin until the first quarter of 2013, which was later than had been expected. Blackberry 10 had been slated for a fall release, in time for the crucial holiday selling season.
In its press release, Research in Motion 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."
Research in Motion additionally said that it is proceeding with its earlier announced plans to lay off 5,000 employees.
The company's CEO Thorsten Heins said, “I am not satisfied with these results and continue to work aggressively with all areas of the organization and the Board to implement meaningful changes to address the challenges, including a thoughtful realignment of resources and honing focus within the Company on areas that have the greatest opportunities.”
In Thursday's after hours trading session, RIMM shares have plummeted more than 17% to $7.54. Over the last 5 years, RIMM has lost 84%, including almost 68% in the last year. Analysts are now projecting that the one-time high-flier could run out of money within 18-24 months.
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