The woes continued for BlackBerry maker Research In Motion on Thursday as it reported a net loss for the three months to March 3 of $125m. The same time a year ago it reported a profit of $934 million. Revenues dropped from $5.2 billion to $4.2 billion.
Poor sales of its range of smartphones, as well as its PlayBook tablet, have contributed to the slump in the company’s fortunes.
Heins: ‘Substantial change needed’
Thorsten Heins, the man running the company since taking over from Mike Lazaridis and Jim Balsillie in January, put the situation in no uncertain terms in a conference call with analysts.
“I did my own reality check on where the entire company really is,” he said on Thursday. “Having had the benefit of going through this process from the vantage point of CEO, it is now very clear to me that substantial change is what RIM needs.”
In further developments, former co-CEO Balsillie stepped down from his position as a RIM director. Its chief technology officer and chief operating officer also resigned. Exploring ways to bring the company out of the doldrums, RIM said it would be looking at the possibility of partnerships as well as joint ventures licensing.
RIM shipped 11.1 million BlackBerry smartphones in its latest quarter, a drop of 21 percent over the previous quarter. It marked the company’s first decline in the period covering Christmas since 2006, a statistic which must have made grim reading for executives at the Waterloo, Ontario company.
As for its beleaguered PlayBook tablet, RIM said it sold more than half a million in its latest quarter, though it has to be remembered that many sales were made off the back of deep discounting.
Heins also stated that the company would once again turn its attention to the corporate market rather than individual consumers in a bid to get RIM back on track.
“We plan to refocus on the enterprise business and capitalise on our leading position in this segment,” he said. “We believe that BlackBerry cannot succeed if we tried to be everybody’s darling and all things to all people. Therefore, we plan to build on our strength.” The success of Apple’s iPhone and the wide use of Android-powered devices has put immense pressure on the BlackBerry maker’s position in the corporate market, particularly recently as more companies allow their employees to use their own phone at work.
RIM desperately hopes that its forthcoming BlackBerry 10 handsets, set to be launched later this year, will help it to re-establish its once strong position in the business world.
Speaking to Reuters about RIM’s outlook, Peter Misek, a senior tech analyst at New York-based Jefferies & Co., said, “It’s going to be [an] absolute gong show for the next few quarters. They’re going to scramble around now for the next three to six months, and every poor shareholder that had faith in them is going to be potentially impoverished.”
RIM is clearly still on the rocky road, but whether it takes them to ruin or somewhere more comfortable depends on how Heins moves things forward, how consumers respond to the changes and whether the upcoming BlackBerry 10 handsets can make a splash.
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