Blackberry manufacturer Research in Motion (RIM) has announced a 71% slump in net income and indicated a gloomy sales outlook for its smartphones during the Christmas period.
In its third quarter results, released overnight, the manufacturer reported sales of $5.2bn for the three months to 26 November. While this is up 24% from its last quarter, it's down 6% on 2010. Net income was down from $911m last year to $265m. RIM said it was hit by charges of $40m for its third quarter service interruption, a $485m hit for unsold PlayBook tablets. Taking into account exceptional charges, net income was down 60.3% from $667m.
In a conference call with analysts, RIM co-CEOs Jim Balsillie and Mike Lazaridis said its next generation of smartphones running the BlackBerry 10 operating system is unlikely to be released until the end of 2012.
The company also suggested it will sell less Blackberrys in its third quarter than the previous quarter. It said smartphone shipments for the next three months will be between 11 million and 12 million. In the three months to 26 November, it shipped approximately 14.1m smartphones.
It also was pessimistic about its fourth quarter performance. It predicted sales of between $4.6bn and $4.9bn. Turnover for its fourth quarter in its last financial year was $5.6bn.
RIM co-CEOs Jim Balsillie and Mike Lazaridis said: 'As part of our commitment to improving our performance to better meet the expectations of shareholders and customers, we coninute to evaluate ways to improve in several areas of the company's operations. It may take some time to realise the benfits of these efforts and the platform transition we're undertaking, but we continue to believe that RIM has the right set of strengths and capabilities to maintain a leading role in the mobile communications industry.'