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RIM posts $235m quarterly loss but shares rally on positive prospects

28 Sep 2012

Research in Motion (RIM) has surprised the market by posting better than expected financial results for the second quarter of 2012, although it still saw losses of $235m for the quarter.

After a torrid run of financial results in the last few years, the financial industry gave RIM its backing after the firm reported cash flow of $432m for the quarter and revenues of $2.9bn, with shares rising by almost 20 percent.

The firm revealed also revealed it now has 80 million global subscribers, up from approximately 78 million in the last quarter. It also shipped 7.4 million handsets, and 130,000 PlayBook devices, in the quarter.

By way of contrast, Apple sold 5 million iPhone 5 handsets in its opening weekend.

And the sales were not enough to stop the overall losses, but chief executive Thorsten Heins was bullish the signs of recovery in the results were proof the firm is on track to turn things around.

"Despite the significant changes we are implementing across the organisation, our second quarter results demonstrate that RIM is progressing on its financial and operational commitments during this major transition," he said.

"Make no mistake about it, we understand that we have much more work to do, but we are making the organisational changes to drive improvements across the company, our employees are committed and motivated, and BlackBerry 10 is on track to launch in the first calendar quarter of 2013."

Ovum analyst Nick Dillon told V3 that while the results weren't stellar when looked at objectively, they did offer a "glimmer of hope" for the firm.

"They're obviously not very impressive results, but compared to what people were expecting they could have been a lot worse so from that point of view it's a positive for the firm," he said.

"The launch of BlackBerry 10 will be the watershed moment for them, and if it's not hit it could prove the beginning of the end for RIM as we know it today, but with losses reigned in and a growing user base, there are some positive signs."

Dillion also noted that Heins should get some credit for the improvements, with investors seeing him as a safe pair of hands guiding the firm forward to its next era

The results come after a busy week for RIM in which it touted the BlackBerry 10 platform to developers at its Jam conference in San Jose, where it did everything it could to keep those coding for the platform on board, including promises of $10,000 returns on any apps made.

The positive news for RIM will be welcomed by all at the firm, after nothing but problems in the last 12 months, including an outage that hit customers in the UK last Friday, which affected around six percent of its global user base, around five to 10 million users.

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Dan Worth

Dan Worth is the news editor for V3 having first joined the site as a reporter in November 2009. He specialises in a raft of areas including fixed and mobile telecoms, data protection, social media and government IT. Before joining V3 Dan covered communications technology, data handling and resilience in the emergency services sector on the BAPCO Journal

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