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Reading through the news this morning I noticed this story from the Globe and Mail. The summary version of the story is that Bernstein analyst Pierre Ferragu thinks RIM will miss its Q3 financial guidance.

Remember that RIM, like many other public companies, issues quarterly guidance when they report financial results. So along with Q3 results they issued expectations for Q4. When a company is going to miss numbers, it is very common to issue a press release updating the guidance. Wall Street lingo for this is an "earnings warning". So you'll hear people say, "XYZ corp warned last night".

I have not read the Bernstein report yet. If I get my hands on it and need to update this article, I will. But based on the Globe's reporting, it seems Ferragu thinks RIM will deliver only $4.3 billion in revenue. Guidance was $4.6 to $4.9 billion, so $4.3 would certainly be a miss. Note that the Globe story says guidance was "almost $5 billion". Come on guys - if you're going to be so specific about the analyst's estimate and then be vague (and inaccurate) about the guidance range, it's not exactly fair reporting, is it?

For earnings, Ferragu estimates RIM will earn $0.72 per share. RIM's guidance was $0.80 to $0.95 per share. Quite a bit higher.

What I'm wondering is why Wall Street seems to be so convinced that RIM will miss its earnings when they haven't warned.

Yes folks ... it's true. RIM has not issued an earnings warning for Q4. The quarter ended on March 3rd. They report on March 29th.

I've covered this company for over a decade. In that time they've only ever warned a few times. They've also press released the occasional earnings surprise. But for the most part, RIM has a very good track record of coming in within its guidance range for earnings and revenue.

Please don't misunderstand me. RIM does not have a good track record (lately) for meeting longer-term goals. Remember when they started out this fiscal year and said they'd earn at least $7.50 per share for the full year. It was a rare situation for RIM to provide full year guidance, and turned out to be a disaster. They had to cut this guidance repeatedly throughout the year.

Now we have a few Wall Street analysts who are saying RIM will miss Q4. I am not saying they're wrong. However, I am saying that for them to be right it has to represent an anomaly in RIM's historical reporting. For the few times in history that RIM has missed quarterly guidance, it issued earnings warnings either well before the quarter ended, or very shortly after.

Just look at last quarter as a perfect example. The quarter ended November 28th. RIM put out a press release on December 2nd disclosing a huge inventory write-down on Playbook inventory. That's within a week of the quarter end.

Today it is March 14th. RIM's quarter ended 11 days ago. The chances of them issuing an earnings warning seem remote at this point, based on history.