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Is this the end?

Analysts were predicting a small loss from embattled Canadian smartphone maker Research in Motion, Ltd. (TSE:RIM); a loss that they concluded would drive the company closer to a likely sale in 2013.  But the analyst consensus of a $0.03 USD per share loss on $3.1B USD revenue went from seeming gloomy, to seeming downright flowers and roses compared to RIM's actual financials.

I. RIM Reports Horrifying Financials

RIM reported [PDF] an abysmal $2.8B USD in revenue an a lost of $0.30 USD per share.  The loss is RIM's second straight quarter of escalating money bleeding.

RIM, which employs approximately 16,500 people worldwide, also committed to layoffs of 5,000 employees, or roughly 30 percent of its workforce.  That will leave RIM with just over 10,000 employees globally -- about half of its peak workforce of 20,000 in 2009.

RIM Sign
RIM is laying off almost a third of its employees. [Image Source: BGR]

The jobs cuts were much worse than the expectation -- 2,000 layoffs.  RIM had announced that layoffs would indeed be coming weeks ago, but it held off on sharing exact numbers.  It's unfortunate to see exactly how deep RIM is cutting to try to save the ship, but it's perhaps understandable given how much worse than expected the financials were.

While RIM clings to a dwindling number of large enterprise users, the root of its problem was plunging sales of BlackBerry smartphones.  RIM mustered only 7.8 million units sold, down over 40 percent from last year's numbers [PDF] (13.2 million).  Sales of the PlayBook tablet plunged to 260,000 amid RIM's cut of its most popular SKU.  That marks almost a 50 percent drop from last year's sales of 500,000 units.

Ex-RIM CEO Mike Lazardis's 2009 quote to Fortune during the peak of RIM's success is looking more and more like a warning to future CEOs on the perils of mismanagement -- "Sometimes we have to put the brakes on.  We've shown that we can handle annual 100% growth. I'm not sure we could handle more than that."

Every part of RIM is shriveling and dying, from its supply chain to its business user-base, to its consumer pull.

II. BB 10 Gets Delayed, End is Nigh for RIM

But that's not even the bad news.  RIM also offered this jewel in its earnings report:

BlackBerry 10 smartphone launch now scheduled for Q1 of calendar 2013.

In other words, everyone's favorite vaporous smartphone platform has been bumped yet another half year.  

RIM London
BB10 has been bumped to 2013  -- if RIM makes it that long. [Image Source: NeoWin]

To put this in context, RIM bought QNX in April 2010, with the intention of using it as a replacement for its current smartphone operating system.  In a market that moves like lightning RIM's fumbling executive ranks have managed to take nearly 3 years to turn this gifted wrapped platform into product.  In other words, what should have been a chip shot was turned into a Hail Mary due to pure, unadulterated incompetence.

RIM over the last year has made a sad joke of itself, with its faked "flash mob" protests at Apple, Inc. (AAPL) stores in Australia and its new chief executive's arrogant attacks on the world's most used smartphone platform, Google Inc.'s (GOOG) Android.  Apparently somewhere along the way RIM forgot that Google and Apple each and every year deliver something that it does not -- actual operating system product.

Or perhaps RIM was too busy courting business users with Saturday morning cartoon characters to notice.

RIMdenberg
Analyst predict more destruction for the RIMdenburg.
[Image Source: Jason Mick/DailyTech LLC]

Regardless, if there's one thing that's clear it's that a sale of RIM is likely coming soon.  It seems unlikely that RIM will survive to see its ever-slipping operating system arrive.  

Investors will surely be eager to salvage what little they can from the company.  The company does have some decent assets -- namely its large intellectual property portfolio, its recognizable business brand, and its superb physical keyboard mastery.

It would be relatively shocking if RIM is not put on the auction block before the year's end.

Source: RIM



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RE: freegin ouch!
By topkill on 6/29/2012 1:49:30 PM , Rating: 2
Pirks, my GOD dude, you are seriously delusional.

I'd say we need to put you on suicide watch because the end is coming, and it clearly means something really deep and spiritual to you.

Question for you: Do you think that maybe the Aztecs were predicting the end of RIM???

LOL


RE: freegin ouch!
By retrospooty on 6/29/2012 3:17:48 PM , Rating: 2
"Pirks, my GOD dude, you are seriously delusional."

I know... Its pretty funny, but you cannot get this guy to see the obvious writing on the wall no matter what. Layoff 30% of the workforce and delay the already delayed last hope OS, hire financial firms to evaluate the company, announce that you are open to selling the company and he STILL thinks it cant happen. LOL.

The ONLY reason it hasnt sold already is that RIM is asking too much $$$ for a product with no gauranteed future. Even if QNX/OS10 is great, it still has a huge uphill climb to gain recognition, and with Winmobile now coming in as a great alternative to Android and IOS, there isnt much room for a company that cant execute well at all.


"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














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