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Press Release: Research in Motion Reports Third Quarter Financial Results

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Press Release: Research In Motion Reports Q3 Results for Fiscal 2013

RIM
By Adam Zeis on 20 Dec 2012 04:15 pm EST
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RIM has reported their earning for Q3 of fiscal 2013 today. We knew pretty much how things would turn out, so not too many surprises here. RIM has been dedicated to BlackBerry 10 for the last few months, so the results here are fairly on par with what we expected. The unveiling of BlackBerry 10 is only a few weeks away so we still hope to see amazing things in the coming months. You can tune into the earnings call at 5p EST for more and rest assured we'll have a follow-up post on everything later tonight. Keep reading for the full press release.

Research In Motion Reports Third Quarter Fiscal 2013 Results

WATERLOO, ONTARIO--(Marketwire - December 20, 2012) - Research In Motion Limited (RIM) (NASDAQ: RIMM)(TSX: RIM), a world leader in the mobile communications market, today reported third quarter results for the three months ended December 1, 2012 (all figures in U.S. dollars and U.S. GAAP, except where otherwise indicated).

Highlights:

  • Cash increase of approximately $600 million to $2.9 billion 
  • Cash flow from operations was approximately $950 million 
  • Revenue of $2.7 billion 
  • GAAP net income from continuing operations of $14 million, or $0.03 per share diluted, including a $166 million favorable tax settlement 
  • Adjusted net loss of $114 million, or $0.22 per share diluted 
  • BlackBerry subscriber base of approximately 79 million users 
  • Shipments of 6.9 million smartphones and 255,000 PlayBooks 
  • RIM's Chief Information Officer, Robin Bienfait, announces retirement

Q3 Results

Revenue for the third quarter of fiscal 2013 was $2.7 billion, down 5% from $2.9 billion in the previous quarter and down 47% from $5.2 billion in the same quarter of fiscal 2012. The revenue breakdown for the quarter was approximately 60% for hardware, 36% for service and 4% for software and other revenue. During the quarter, RIM shipped approximately 6.9 million BlackBerry smartphones and approximately 255,000 BlackBerry PlayBook tablets.

GAAP net income for the quarter from continuing operations was $14 million, or $0.03 per share diluted. GAAP net income for the quarter, including loss from discontinued operations, was $9 million, or $0.02 per share diluted, compared with the GAAP net loss of $235 million, or $0.45 per share diluted, in the prior quarter and a GAAP net income of $265 million, or $0.51 per share diluted, in the same quarter last year.

Adjusted net loss for the third quarter was $114 million, or $0.22 per share diluted. Adjusted net loss and adjusted diluted loss per share exclude the impact of pre-tax charges of $55 million ($38 million on an after-tax basis) related to the Cost Optimization and Resource Efficiency ("CORE") program and excludes the impact of an income tax benefit of $166 million. These impacts on GAAP net income from continuing operations and diluted earnings per share are summarized in the table below.

"RIM continued to execute on its product roadmap plans and to deliver on key financial metrics as it gets set for the global launch of BlackBerry 10," said Thorsten Heins, President and CEO. "During the third quarter, we continued to demonstrate our strong financial position, generating $950 million in cash flow from operations, and increasing our cash position significantly to more than $2.9 billion. More than 150 carriers are currently completing technical acceptance programs for the first BlackBerry 10 products, and beta trials of BlackBerry Enterprise Service 10 are underway at more than 120 enterprises including 64 Fortune 500 companies. This is an exciting time and our carrier partners, application developers and employees are all looking forward to unveiling the innovation and excitement of BlackBerry 10 to our customers on January 30, 2013."

RIM also announced today that Robin Bienfait, Chief Information Officer for RIM has made the decision to retire at the end of this year following 6 years of service to the Company. Robin has committed to continue supporting RIM in an advisory capacity to enable a smooth launch and seamless transition.

Under Robin's watch, the BlackBerry service infrastructure has grown from 47 petabytes per year to more than 33 petabytes per month at the same time as the internal corporate infrastructure for RIM has grown at a remarkable pace. Robin joined RIM in the beginning of 2007 with the mandate to take RIM's BlackBerry data services infrastructure from a single presence in Canada to a distributed model connecting to over 650 carrier partners worldwide. In addition, over this past year, Robin has led RIM's Enterprise business unit focused on enabling services for Enterprise customers and preparing for the launch of the BlackBerry 10 platform. Robin has led a distinguished career. Before joining RIM, Robin held a number of senior leadership positions at AT&T and Bell Labs for over 22 years.

"Robin has been an outstanding CIO and has built a world class organization. Her team has diligently prepared us for the launch of BlackBerry 10 and beyond, and I will remain deeply grateful for her leadership and commitment," said Thorsten Heins, President and CEO of Research In Motion.

Outlook

The Company expects that there will be continued pressure on operating results as it gets set to launch its BlackBerry 10 platform in the fourth quarter. The Company intends to continue to consider using pricing initiatives on BlackBerry 7 devices and service fees in some markets as a way to maintain our subscriber base and drive more BlackBerry users. The timing of the BlackBerry 10 launch event for January 30, 2013 could also impact sales of current BlackBerry 7 products as some customers may defer purchasing decisions and wait for BlackBerry 10 devices. All these factors are expected to impact unit volumes, subscribers, margins and service fees. In addition, the company will be significantly increasing its marketing spending this quarter as expected, to support the global launch of BlackBerry 10, and the Company expects to report an operating loss for the fourth quarter. Further details about the Company's outlook will be discussed on the conference call and live webcast t o be held beginning at 5 pm ET today, information for which is set forth below.

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Press Release: Research In Motion Reports Q3 Results for Fiscal 2013

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Yes, they had a net loss of active users for the first time in many years.

Considering that they're in with quite old products at this point, I'm actually mostly pleased with the numbers:

- Thorsten raised cash noticeably more this quarter than the last few
- They still have no debt (I believe)
- They shipped almost 7 million phones, despite the issue of them being old, dated and about to be replaced
- PlayBook just topped 2 million shipped, I think

This is the effect of stabilizing a company. Great leader for the future. The loss will obviously be on old devices which may have proven obsolete in certain market; to be specific in offices where users are pushing to jump on the band wagon of Apple and Android.

I swear some people are complete idiots at performing their responsibilities. If not, they are requesting a device that will purposely prevent them from working. Either way, they are and will be missing out on the multitasking that BB10.

The Marketing office needs to do more Globally to get BB10 off to the hands of those loyal BB users and the many that have jumped to Apple and Android. I have massive arguments with people in an effort to educate them on the benefits of having a BB or getting BB10 over other devices.

I currently have 4 9800s and a 9700 that I will be shipping to the Caribbean to put 5 people on BB. My Facey is loaded with video clips educating my friends list.

RIM where are the ADs???

Let's all do our part to get BlackBerry on the RoadMap to success.

I am with you brotha!!!! See my comment on the BB10 Zed/Z 10 naming. http://crackberry.com/so-it-blackberry-zed-10-or-zee-10

I am a dedicated BLACKBERRY fan for life. I have used all the other phones. Final conclusions are all the other so called smartphones don't properly perform the core features of BB's anywhere near as well as a BB. They all did one thing or another that completely irratated me from not having an indicator light on the device, to not allowing you to properly type on a touchscreen w/o seriously having a nervous breakdown.

My 2 cent. :) Happy Holidays, all!!!!!! :-)

Problem is you cannot find any playbooks in stock! I know several people who would have bought one this year but could not find any!

Looks that way on Reuters

2012 * Blackberry subscriber base of approximately 79 million users at quarter end
versus 80 million in prior quarter
* More than 150 carriers are currently completing technical acceptance programs
for first bb 10 products" * Says the company expects to report an operating loss for the fourth quarter * Source text [ID:nMKW671a]

hmm still shipping 7million devices per quarter with these "outdated" devices. Not bad. with BlackBerry L or Z10 this should be highly increased@@!!

Looks good considering except for the loss of 3 Million subscribers (79 down from 82) over the Quarter. Glad they stockpiled some more money and hopefully they will invest a little in a Super Bowl ad.

Q2 reported 80m didnt they? iv heard people say 82, but never seen anything from RIM say that publicly

Maybe 82 million by March...they will lose a bunch over Christmas and most early adopters will be coming off of a Blackberry.

This Xmas season without anything will put a small dent to their subscriber base. Hopefully by not too big of a dent. If BB10 turns out awesome, the subscriber base will grow back up.

TMO_9000_32GB_PB

who wants a phone for christmas? I hope my wife would never get me a device that I only use for work. I know, I will get someone a cell phone for zero and lock them into a 3 year contract, I could get everyone on earth a christmas present, wouldn't I be great?

who wants a phone for christmas? I hope my wife would never get me a device that I only use for work. I know, I will get someone a cell phone for zero and lock them into a 3 year contract, I could get everyone on earth a christmas present, wouldn't I be great?

255k playbooks!!wow.

yea the subs dropped a bit, but lets be honest no `hero` launch in a year and BB10 coming soon its not the biggest supprise, it could of been far worse,

what is a supprise is the $0.6bn jump in cash, that`ll help nicely on BB10 advertising.

oh and those 6.9m devices? ya, thats what nokia sold in lumias in 18 months lmfao

Interesting that they were able to bump that cash pile significantly. Free cash flow is a good thing, so long as it is coming from legitimate, stable resources.

Sad to see that net subs dropped by 1 million though.

I wonder how the market will react to this. The increased cash flow is the most important metric because they'll at least be able to properly market and launch BB10. I'm glad I didn't sell my shares just yet.

You would think so, but no it's not. I've seen fiscal years off by a bit before, but this one is way off to the point of being worse than car dealers' model years. No idea who decided it, but you would think they would just line it back up properly. Guess that would make too much sense

Have you seen the intense holiday advertising of samsung, apple and windows phone over the last month or two?? Obviously blackberry has no new phones to compete. Not bad though..2013 her we come.
BB 10...Boldly taking over!

How did they manage to increase cash while losing money? They must be squeezing customers who owe them money or slowing down payments to vendors.

The question is how long after the Jan 30th event until the devices are available otherwise RIMM runs the issue of a further erosion of customer base.

If the CEO can manage this ship and launch Z10 on time, he would have "threaded the needle"... I wish him luck!

with all the hype and millions of devices sold by both samsung and apple, along with no new devices offered by RIM in over a year, I'm not too surprised that the subscribers dropped BUT we must remember that it raised by 10 million in the last quarter so up by 10 and down by 1 is pretty good!!!

Why does RIM always report "shipped" phones ? Now they "shipped" 6.9 million smartphones and "shipped " 250.000 Playbooks. But how many did they actually sell to consumers? Apple always report what they sell ! Probably a lot of the phones and Playbooks are sitting on the shelves and in warehouses collecting dust. :(

They actually Sold more phones than they shipped. Consumers bought 8.4 million devices and RIM shipped 6.9.

They mention it in their conference call.

"Shipped" 6.9 million smartphones those use a dead OS. Feel sorry for those who are not well informed people in the developing country. Technically, those 6.9 million will be obsolete at 30 Jan 2013, (which is - in less than 7 weeks).

An increase in cash balance is not necessarily a good indication, can be a slowing down payment to supplier while get a faster payment from buyer. Can be an indication of no more payment to supplier since no more new / repeat order while still getting payment from selling the existing inventory.

Yes, it would be great if BB10 could save RIM, but I am just wondering what kind of comments do we get if BB10 is only well accepted to the current loyal fan base, whom will upgrade as many as 40% = 32 million but fails to attract switchers from Android and iOS?

Of course, RIM would be able to prolong its life but it will be cornered to a very niche market since Android activation is a 1.3 million device a day = less than a month for the sales (not "shipment") of BB. Good luck for RIM.

There are still places in the world where 3G is a luxury, and 2G is the norm. In those places BBM and Blackberry's data compression lead to a better experience. In those areas no one is waiting on LTE so it's going to be some time before those phones they are selling now are "obsolete".

This strategy has allowed RIM to stem the continued North American sub loss as once again this quarter RIM stated North America is where their biggest sub loss continues. If RIM has any hope, and many feel after using BB10 it's a better than average chance, to stem these losses here in the USA - it will be because of BB10 of course, but it's these sales of these "obsolete" phones that gave them life until then.

go away with your silly yapping. Would want to comment further but your comment dosnt warrant it. Ninny did you know that there are folks still using BB OS 5, 6? these are even older than the 7....poor dummy

Only the market wants you to "see" that. But it isn't.

11 year old computer of mine is still going strong!