RIM to Miss Financial Targets Again, Weak PlayBook Sales to Blame
December 2, 2011 8:58 AM
comment(s) - last by
Much of RIM's future success hinges on its success (or failure) in the tablet market. The company's first foray into the burgeoning market, the PlayBook, has struggled to gain traction among consumers. In an attempt to increase sales, RIM has slashed the retail cost of the PlayBook by $300, at a total cost of $485 million (pre-tax) in Q3.
Discounting to drive tablet sales costs Canadian company $485 million
BlackBerry manufacturer Research In Motion (RIM) today announced that it would not hit its projected third-quarter revenue estimate of $5.3-$5.6 billion that the Canadian company forecasted at the end of Q2.
The company, headquartered in Waterloo, Ont., pointed to discounting of its already weak PlayBook tablet sales as one reason the company will miss its financial goals. RIM said it was also expecting to miss its projected full-year earnings per share (EPS) of $5.25-$6.
Still, the company says it will stand behind the PlayBook tablet, and that the tablet market is "still in its infancy."
"Although a number of factors have led to the need for an inventory provision in the third quarter, we believe the PlayBook, which will be further enhanced with the upcoming PlayBook OS 2.0 software, is a compelling tablet for consumers that also offers unique security and manageability features for the enterprise," RIM co-CEO Mike Lazaridis said in a press release.
Recently, RIM slashed the price of its PlayBook tablet by $300, bringing the total cost down to $200 (from $500) for the base 16GB model. In an attempt to drive sales, the intense tablet discounting cost the manufacturer a reported $485 million — $360 million after tax. "Early results from recent PlayBook promotions indicate a significant increase in demand across most channels," Lazaridis said.
The company says it will record a pre-tax provision of $485 million in Q3 to write down the value of unsold Playbook tablets, 150,000 units of which RIM says it sold to retail channels in the same time period.
RIM's troubles adjusting to a post-iPhone/Android mobile market are well documented. The company hasn't been helped any by the widespread,
media attention-grabbing outages
or weak sales of the
initially overpriced and not-quite-ready-for-its-closeup PlayBook tablet
reports of unmet quarterly financial goals
are becoming a bit of a theme — or recurring nightmare — for RIM. The company is forecasting an even weaker Q4 compared to Q3, "due to several factors including lower than expected sell-through in the third quarter and RIM’s current view of fourth quarter demand."
The Globe and Mail
This article is over a month old, voting and posting comments is disabled
RE: Like my BB9930 and Playbook
12/4/2011 12:13:12 AM
Wow. I get rated down simply for stating a personal view. I guess since it wasn't pro-android or pro-apple (despite me saying they do have their strong points), the fanboys have nothing better to do.
What a bunch of f*cking retards. This is why DT is going to crap.
RE: Like my BB9930 and Playbook
12/5/2011 1:37:38 AM
Now you are being crybaby. Don't take it so personally. It just means that some people don't like what you say, but since going into discussion is too time consuming, rating button goes into action.
"Let's face it, we're not changing the world. We're building a product that helps people buy more crap - and watch porn." -- Seagate CEO Bill Watkins
RIM Co-CEO Mike Lazaridis Apologizes for BlackBerry Outage
October 13, 2011, 10:21 AM
RIM Q2 Earnings Are Bleak, Q3 Expectations are Higher
September 15, 2011, 5:34 PM
BlackBerry PlayBook Review Roundup
April 13, 2011, 9:52 PM
Smart Security Cameras: 5 Good Choices For Any Budget
July 25, 2016, 7:13 PM
Top 5 Smart Watches
July 21, 2016, 11:48 PM
Retiree Sues Apple For $7,500 for Wiping Honeymoon Photos From His iPhone
November 30, 2015, 10:23 AM
iPhone 7 May Pack 3-4 GB Memory, More Storage; 4-Inch Comeback is Rumored
November 20, 2015, 10:12 PM
OnePlus One, OnePlus 2 Will Receive Android Marshmallow in Q1 2016
November 16, 2015, 9:58 AM
Lenovo Whoa: Motorola Droid MAXX 2 and Turbo 2 Break Cover in Leaks
October 26, 2015, 3:12 PM
Most Popular Articles
Say Goodbye to Data Plans - Sprint and T-Mobile offer Unlimited Data
August 22, 2016, 6:12 AM
2 NEW PlayStation 4 Models - Unveiling September 7th
August 23, 2016, 6:23 AM
Uber - Everyone's Autonomous Car Driver?
August 20, 2016, 6:01 AM
iPhones May Get Curved Screens Next Year
August 24, 2016, 6:45 AM
Lenovo vs. Asus vs. HP - Best Laptop Under $500.00
August 19, 2016, 4:00 AM
Latest Blog Posts
Coming Soon - Drones and Airports
Aug 24, 2016, 12:40 PM
SolarCity’s Gigafactory: A Milesone in Emerging Technology by Lily Emamian - 15 August 2016
Aug 15, 2016, 6:30 AM
Sceptre Airs 27", 120 Hz. 1080p Monitor/HDTV w/ 5 ms Response Time for $220
Dec 3, 2014, 10:32 PM
Costco Gives Employees Thanksgiving Off; Wal-Mart Leads "Black Thursday" Charge
Oct 29, 2014, 9:57 PM
"Bear Selfies" Fad Could Turn Deadly, Warn Nevada Wildlife Officials
Oct 28, 2014, 12:00 PM
More Blog Posts
Copyright 2016 DailyTech LLC. -
Terms, Conditions & Privacy Information