In what can certainly be considered an overall negative set of announcements today, RIM revealed some bad news about its current state in a few different areas in its conference call to investors. And while good news was hardly expected from RIM, the extent and number of poor indicators was rather significant.
Perhaps the biggest letdown of the conference call to investors was the updated release date of the highly-anticipated BlackBerry 10 – not later this year, as had been previously announced but, instead, sometime in the first three months of 2013. While they tried to temper the negativity of this news by insisting that they have no intention of releasing a product which is not ready to “meet the needs of [their] customers,” it is certainly bad news if the product which is supposed to revive interest in the BlackBerry is to be released behind schedule.
Other news which may be less likely to affect most BlackBerry users was negative in nature as well. In what was called a necessary move in aligning RIM’s cost structure, it was announced that RIM would swiftly reduce its workforce by 5,000 people by the end of the fiscal year. (Though this is clearly discouraging news, they claim that it should not affect “key programs” like BlackBerry 10 and customer support.)
On the financial side, the news was equally bleak. Revenues were down in both the US and international markets, though the US declines were said to be modest. The net loss for the quarter was over $500 million and a net loss is expected for next quarter, as well.
Though the overall impression given off was hardly positive, there were some encouraging statements made. Despite all of RIM’s challenges, their global subscriber base grew to 78 million users. Additionally, they have shipped about 250,000 Playbooks and 7.8 million smartphones. Also, the interest in the BlackBerry 10 is apparently quite real, as the BlackBerry 10 Jam Tour for developers sold out in its locations in Montreal, London and New York as well as other locations.
Moving forward, RIM will be focusing on four areas: Keeping the product development focus on enterprise and BYOD; a streamlined – but more limited – product line (including a full QWERTY BlackBerry 10); licensing opportunities for the BlackBerry 10 platform (including, possibly, an expansion to other segments, i.e. beyond smartphones); and building on its 78 million person customer base.
Though bleak, the prospects for RIM are hardly dead. The interest in the BlackBerry 10 is encouraging and they do have cash stored away for such a rainy day; but if the anticipated product will not come to fruition soon, then the anticipation will evaporate, as well.