BlackBerry maker downgrades Q2 forecasts and announces plan to streamline operations following profit and revenue drop
Research In Motion (RIM) has announced it is to cut jobs following a disappointing Q1 performance that saw profits slide 9.5 per cent year on year.
Profits for the quarter, which ended on May 28, were $695 million (£430 million) compared to $769 million in the same quarter a year ago.
RIM also released revised Q2 forecasts estimating revenues at between $4.2 billion and $4.8 billion, well below analysts expectations of around $5.47 billion.
“Fiscal 2012 has gotten off to a challenging start. The slowdown we saw in the first quarter is continuing into Q2, and delays in new product introductions into the very late part of August is leading to a lower than expected outlook in the second quarter.” said RIM co-CEO Jim Balsillie.
The BlackBerry maker said that a program to “streamline operations” would include a headcount reduction, and a renewed focus on growth opportunities and accelerating new product introductions.
RIM’s failure to bring out new BlackBerry handsets has been blamed for falling market share.
The firm said it shipped 13.2 million BlackBerry devices during the quarter, down from 14.9 million the previous quarter and around 300,000 less than had been expected. The firm also said it shipped 500,000 units of its new PlayBook tablet, more than analysts had expected.
Revenues were down 12 per cent to $4.9 billion during the quarter from 5.5 billion the previous quarter, though up 16 per cent from $4.2 billion the same period a year ago. Wall Street analysts had been predicting revenues of around $5.13 billion.
Research In Motion’s chief operating officer Don Morrison is leaving the Canadian firm for medical reasons. Former Research In Motion COO Larry Conlee is coming back to the company as a special advisor.