BlackBerry manufacturer, Research In Motion has managed to keep its business growing despite the on-going credit crunch, which seems to be taking its toll on other telecoms companies, especially those targeting the higher end of the market.
RIM more than doubled its quarterly revenue for the three months ending March 2008, reaching £ 0.95bn. The revenue breakdown for the quarter was 81% from devices, 14% for services, 3% for software and 2% for other revenue.
Revenue for the fiscal year ending 1 Marchwas £3bn; almost double that of last year’s £1.54bn. Net income for the quarter was £208.45m, up from £187.21m during the previous quarter. In total, 14 million BlackBerry handsets were sold during the year.
Roughly half of all BlackBerry sales were from handset replacements and the remaining half from new customers. RIM says only 5% of its potential market is currently penetrated.
Despite the current economic climate, RIM estimates a growth in revenues for the next quarter, predicting to reach £1.13bn and £1.15bn. The company seems to have escaped the first effects, as sales continue to rise, but this is unlikely to continue in the long run.
Nomura analyst Richard Windsor commented: ‘The economy is already impacting the demand for handsets. The global credit crunch is causing many companies and even consumers to think more carefully about expenditure. Consequently forecasts for global economic growth are slowing markedly, which has hit demand for high end handsets.’
Although this hasn’t impacted RIM yet, the company is unlikely to escape untouched. ‘We see no reason why replacement demand for RIM’s product should not be affected,’ Windsor said