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RIM's 1Q Revenue Up On BlackBerry Competitive Dominance
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SAN FRANCISCO (Dow Jones) -- Research In Motion Ltd. late Thursday reported a quarterly profit that slipped slightly, even though sales rose 35%, as higher expenses for employee stock options and other costs offset stronger corporate demand for its BlackBerry communication devices.
The results, combined with sales and profit forecasts for the current quarter that met Wall Street expectations, helped push the firm's shares up as much as 5% in after-hours trading.
Research In Motion, based in Waterloo, Ontario, said net income for its first fiscal quarter ended June 3 fell to $129.8 million from $132.5 million a year earlier. Its earnings per share rose to 68 cents from 67 cents, thanks to a lower share count.
The company was expected to earn 65 cents a share, based on the average estimate of analysts surveyed by Thomson First Call.
Sales rose to $613.1 million from $453.9 million a year ago, slightly more than analysts' expectations of $602 million, as RIM added 680,000 new BlackBerry subscribers.
Research In Motion had cut its forecast for the quarter as uncertainty surrounding a long-running patent lawsuit caused some corporate users to delay purchases and slowed the rollout of new BlackBerry service by some wireless providers. RIM settled the suit in March for $612.5 million.
The company was a pioneering maker of wireless e-mail devices and has been enjoying double-digit sales and profit growth for several years. It's still growing faster than rivals like Palm Inc., which also reported results late Thursday and posted sales growth of 20%.
Still, RIM shares are essentially unchanged this year, versus an almost 18% gain for Palm, as investors have worried that some of uncertainty surrounding the lawsuit may have cost RIM market share at a critical stage.
Both companies are facing new competition from larger rivals Nokia and Motorola.
Research In Motion forecast sales in the range of $620 million to $650 million for the quarter ending in September, in line with analysts' expectations of $636 million. RIM said it expected to add between 675,000 and 700,000 subscribers during the quarter.
The company forecast earning per share between 67 and 73 cents, including stock-option costs, compared with the average analyst estimate of 72 cents.
(END) Dow Jones Newswires "
Tags: [thomson] [palm] [rim] [research in motion] [lawsuit] [patent]
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