RIM predicts loss for current quarter; hints at layoffs

Research in Motion surprised investors today with an early announcement concerning its current fiscal quarter. While the quarter isn't scheduled to end until June 2nd, its CEO Thorsten Heins admitted today in a press release that the company's numbers will "likely result in an operating loss for the quarter."

Reins said that the loss was due to the "on-going competitive environment" along with "highly competitive pricing dynamics in the marketplace." This weekend, rumors hit the web that RIM could announce layoffs that could affect 2,000 team members. Heins did state in the press release that RIM plans to make "...significant spending reductions and headcount reductions in some areas throughout the remainder of the fiscal year." Specific numbers were not mentioned.

RIM will receive assistance from JP Morgan Securities and RBC Capital Markets in reviewing the company's business and financial performance, according to Heins. JP Morgan and RBC will take a look at what RIM could do in terms of using its Blackberry OS "through partnerships, licensing opportunities and strategic business model alternatives."

At the same time, Heins said that the company was encouraged by the response software developers gave both the Blackberry 10 OS and its prototype phone, which were officially revealed earlier in May. Blackberry 10 is still scheduled to launch sometime in the latter half of 2012.

Heins concluded the press release by saying, "Although we are facing challenges, we remain excited about BlackBerry 10 and believe that this platform coupled with the results of the strategic review will create long-term value for our stakeholders."

Source: Research in Motion press release

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9 Comments

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butilikethecookie said,
There goes my stocks...should i bail?

I don't hate RIM. But I do think RIM is dying. The disease is reversible, I think, but nobody over there seems to be seriously looking for a cure. TFS says RIM stock is down 75 percent from last year alone. Imagine a patient who has lost 75 percent of his body weight but keeps insisting, "I'm not sick!"

My own experience: My last three phones before my current one were BlackBerrys. But I started looking around and comparing prices and it seemed to me that other phones could provide at least most of the functionality that my BlackBerry gave me, plus more besides. I also wasn't impressed with the hardware of the current crop of BlackBerry devices. It seemed like RIM's focus had drifted from its core business market and it was trying to sell camera phones to college students. They didn't seem like they were targeting me anymore, and other manufacturers were. So I switched to Android.

I'd be more than happy to switch back to BlackBerry if they'd show me a really great phone, though. Do they have something like that in the works? I don't see it. The market doesn't seem to see it, either.

You know who you remind me of? Me, when I was a Mac OS admin in the late 90s. Back then, everybody thought Mac users were a cult. We were all convinced our platform was the best, but everybody else kept focusing on how Gil Amelio had ****ed up a once-great company. We Mac fans were right, but so was everybody else. It took Steve Jobs' return to get Apple back on track. Unfortunately, I don't think RIM has a Steve Jobs.

ChuckFinley said,

*snip*

Awesome advice! Thank you! I started buying when they first tanked at 13 bucks a pop. Maybe I can wait until they get back up to 13.50 and sell them.

Hey you being a Mac admin really does sound like me! LOL! I only use Windows if I want to play games and Linux if I'm feeling REALLY nerdy,