Jim Balsillie resigns from RIM?s board as Q4 results disappoint
Given Research In Motion?s waning smartphone sales over the past couple of years, expectations were not high for the company?s fiscal fourth quarter results announced yesterday, but the company still managed to surprise financial markets by missing many expectations and announcing the resignation of former co-CEO Jim Balsillie from the board of directors.
RIM reported after the markets closed yesterday that its revenue for the quarter totaled $4.19 billion, down 19 percent from the previous quarter, and that it shipped 11.1 million smartphones, down 21 percent from the previous quarter. The company reported a net loss of $125 million.
?There is a still lot of work to be done on the customer side to meet all of the needs out there,? said Thorsten Heins, president and CEO of Research In Motion, Waterloo, Canada. ?It is very clear to me that substantial change is what we need.
?We plan to refocus on the enterprise business and capitalize on our leading position in this segment. We believe that BlackBerry cannot succeed if we try to become everybody?s darling and we plan to build on our strengths to go after targeted consumer segments.?
Bring your own device
RIM faces growing competition the enterprise front, which has traditionally been one of its strongholds, from Apple, as its devices make inroads into enterprise and government organizations.
RIM was late in the movement towards employees bringing their own mobile devices to work and using them for work purposes, per Mr. Heins. Going forward, the company will make the trend a bigger focus with new devices and services to enable enterprises to manage employees? mobile devices, including BlackBerry, Android and iOS devices.
?I am committed to reclaiming lost market share in that space,? Mr. Heins said.
Other areas RIM will focus on include driving upgrades to BlackBerry 7 by aggressively incentivizing sales, building new services, leveraging its strong carrier relationships and looking to form new partnerships.
Mr. Heins said that BlackBerry 10 is on schedule to launch later this year.
The revenue breakdown for the quarter was approximately 68 percent for hardware, 27 percent for service and 5 percent for software and other revenue.
The good news was that RIM sold more than 500,000 PlayBooks for its best quarter ever. However, this still pales in comparison with the iPad, which sold 3 million units in the three days after the newest version was introduced.
RIM said it has over 77 million subscribers around the world.
More departures to come?
In January, RIM replaced co-CEOs Mike Lazaridis and Jim Balsillie with Thorsten Heins, making him the company?s new president and CEO. At the time, it was announced that Mr. Balsillie would be remaining as a member the board while Mr. Lazaridis became vice chair of RIM?s board and chair of the board?s new innovation committee.
In addition to Mr. Balsillie?s departure, RIM also said yesterday that David Yach is retiring as chief technology officer
The news could confirm reports suggesting that the new CEO has begun laying off high-level staff at the company.
RIM continues to try to allay the fears of marketers and shareholders that BlackBerry is no longer relevant as smartphones from Android and Apple have steadily grown in the consumer and enterprise markets.
One of the challenges facing RIM is that it promised devices built on the new QNX platform but failed to deliver them on time.
The moves announced yesterday are the latest in a series intended to reinvigorate the company.
However, BlackBerry continues to lose market share.
According to new data from Nielsen, only five percent of consumers surveyed in February of this year said they had purchased a BlackBerry in the previous three months. In comparison, 48 percent had acquired an Android phone and 43 percent an iPhone.
During February, 12 percent of smartphone owners have BlackBerry devices.
The company continues to look for ways to drive renewed excitement for its products.
Earlier this month, RIM acquired Paratek Microwave Inc., which develops tunable radio frequency technology, in a move to try to differentiate BlackBerry handsets in ways that are meaningful to consumers (see story).
According to reports, trading of RIM shares was suspended after the market closed because the company did not file required financial documents with the SEC on time.
?Some of our traditional strengths are not as valued and we are looking to identify new services,? Mr. Heins said.
?It is likely that the next few quarters will continue to be challenging,? he said.