Press Release: RESEARCH IN MOTION REPORTS FIRST QUARTER FISCAL 2013 RESULTS
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  1. #1
    Joe Jerde's Avatar
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    Press Release: RESEARCH IN MOTION REPORTS FIRST QUARTER FISCAL 2013 RESULTS

    Here are the results, discuss in the comments below...



    RESEARCH IN MOTION REPORTS FIRST QUARTER FISCAL 2013

    RESULTS

    Waterloo, ON – Research In Motion Limited (RIM) (Nasdaq: RIMM; TSX: RIM), a world leader in the mobile
    communications market, today reported first quarter results for the three months ended June 2, 2012 (all
    figures in U.S. dollars and U.S. GAAP, except where otherwise indicated).
    Highlights:

    •  Cash, cash equivalents, short-term and long-term investments increased to $2.2 billion at the end of the
    • first quarter
    •  Cash flow from operations was approximately $710 million in the first quarter
    •  Revenue of $2.8 billion in Q1, down 33% from $4.2 billion in the prior quarter
    •  GAAP net loss in Q1 of $518 million or $0.99 per share diluted; adjusted net loss of $192 million or
    • $0.37 per share diluted
    •  Shipments of BlackBerry smartphones were 7.8 million and shipments of BlackBerry PlayBook tablets
    • were approximately 260,000
    •  BlackBerry 10 smartphone launch now scheduled for Q1 of calendar 2013
    •  Restructuring efforts underway that will include a workforce reduction of approximately 5,000
    • employees as part of RIM’s efforts to realize over $1 billion in cost savings, based on RIM’s Q4
    • FY2012 run rate
    •  Launched World Tour BlackBerry Jam developer sessions in 23 countries resulting in strong adoption
    • and support by application and developer partners for BlackBerry 10 platform
    •  BlackBerry App World continues to grow with over 89,000 applications available
    •  The overall BlackBerry subscriber base continued to grow, and the subscriber base grew in all regions
    • except for North America
    •  RIM names Steve Zipperstein, former General Counsel of Verizon Wireless, as Chief Legal Officer
    • Q1 Results


    Revenue for the first quarter of fiscal 2013 was $2.8 billion, down 33% from $4.2 billion in the previous
    quarter and down 43% from $4.9 billion in the same quarter of fiscal 2012. The revenue breakdown for the
    quarter was approximately 59% for hardware, 36% for service and 5% for software and other revenue. During
    the quarter, RIM shipped 7.8 million BlackBerry smartphones and approximately 260,000 BlackBerry
    PlayBook tablets.

    GAAP net loss for the quarter was $518 million, or $0.99 per share diluted, compared with a GAAP net loss of
    $125 million, or $0.24 per share diluted, in the prior quarter and GAAP net income of $695 million, or $1.33
    per share diluted, in the same quarter last year.

    Adjusted net loss for the first quarter was $192 million, or $0.37 per share diluted. Adjusted net loss and
    adjusted diluted loss per share exclude the impact of pre-tax charges of $335 million ($326 million on an after
    1 tax basis), which are predominantly non-cash related to the impairment of goodwill. This charge and its
    related impact on GAAP net loss and diluted loss per share are summarized in the table below.
    “Our first quarter results reflect the market challenges I have outlined since my appointment as CEO at the end of January. I am not satisfied with these results and continue to work aggressively with all areas of the
    organization and the Board to implement meaningful changes to address the challenges, including a thoughtful
    realignment of resources and honing focus within the Company on areas that have the greatest opportunities,” said Thorsten Heins, President and CEO. “Our top priority going forward is the successful launch of our first BlackBerry 10 device, which we now anticipate will occur in the first quarter of calendar 2013. In parallel with the roll out of BlackBerry 10, we are aggressively working with our advisors on our strategic review and are actively evaluating ways to better leverage our assets and build on our strengths, including our growing BlackBerry subscriber base of approximately 78 million, our large enterprise installed base, our unique network architecture and our industry leading security capabilities.”

    The total of cash, cash equivalents, short-term and long-term investments was $2.2 billion as of June 2, 2012, compared to $2.1 billion at the end of the previous quarter, an increase of approximately $100 million from the prior quarter. Cash flow from operations in Q1 was approximately $710 million. Uses of cash included
    intangible asset additions of approximately $285 million, capital expenditures of approximately $155 million
    and a business acquisition of approximately $100 million.

    BlackBerry 10 Update

    The successful launch of the BlackBerry 10 platform and the delivery of high quality, full-featured BlackBerry
    10 smartphones remain the Company’s number one priority. Over the past several weeks, RIM’s software
    development teams have made major progress in the development of key features for the BlackBerry 10
    platform; however, the integration of these features and the associated large volume of code into the platform has proven to be more time consuming than anticipated. As a result, the Company now expects to launch the first BlackBerry 10 smartphones in market in Q1 of calendar 2013.

    “RIM’s development teams are relentlessly focussed on ensuring the quality and reliability of the platform and
    I will not compromise the product by delivering it before it is ready. I am confident that the first BlackBerry
    10 smartphones will provide a ground-breaking next generation smartphone user experience,” said Thorsten
    Heins, President and CEO. “We are encouraged by the traction that the BlackBerry 10 platform is gaining with
    application developers and content partners following the successful BlackBerry Jam sessions that we have
    held around the world since the beginning of May. Similarly, the reception of the BlackBerry 10 platform by
    our key carrier partners has been very positive and they are looking forward to going to market with
    BlackBerry 10 smartphones in the first quarter of calendar 2013.”

    Organizational Update

    RIM today also announced the appointment of Steve Zipperstein, former General Counsel of Verizon
    Wireless, as its Chief Legal Officer. Prior to joining Verizon, Mr. Zipperstein previously served as Deputy
    General Counsel for GTE Corporation and was employed with the United States Department of Justice as a
    federal prosecutor. Mr. Zipperstein joins Kristian Tear, Chief Operating Officer and Frank Boulben, Chief
    Marketing Officer as the latest additions to RIM’s executive management team.

    CORE Program

    The Company announced its CORE (Cost Optimization and Resource Efficiency) program in March of this
    year. The program is focused on delivering operational savings through various initiatives, with financial
    objectives for the program targeted to drive at least $1 billion in savings by the end of fiscal 2013, based on
    RIM’s Q4 FY2012 run rate. As a result of the shift in BlackBerry 10 launch timeline, the increasingly
    competitive environment, as well as the identification of additional cost saving and efficiency opportunities,
    2 the Company may increase the scope and magnitude of these programs, and considers these original estimates as minimum numbers it will be pursuing.

    To date, the Company has started implementing a number of these initiatives including:
    - a reduction in the number of layers of management to drive better clarity, efficiency and
    accountability across the organization;
    - the continued streamlining of our supply chain, which includes the consolidation of our
    manufacturing footprint from 10 external manufacturing sites to three, and working closely with
    our suppliers and other partners to identify ways to drive further efficiency;
    - outsourcing key parts of the Company’s Global Repair operations, including management of
    device level repairs;
    - targeted use of resources in our sales and marketing initiatives to more effectively leverage
    marketing windows and prioritize our marketing efforts and spend in regions that offer the highest
    opportunity and return;
    - further outsourcing of non-core functions as determined during the implementation of the CORE
    program; and
    - a global workforce reduction of approximately 5,000 employees, which is expected to be
    completed by the end of fiscal 2013.

    The Company expects to incur restructuring related charges of approximately $350 million by the end of fiscal
    2013, primarily associated with the global workforce reduction. Other charges and cash costs may occur
    during this process, and the Company intends to share more details throughout the year regarding its progress
    as programs are implemented or changes are completed.

    Outlook

    The Company expects the next several quarters to continue to be very challenging for its business based on the increasing competitive environment, lower handset volumes, potential financial and other impacts from the
    delay of BlackBerry 10, pressure to reduce RIM’s monthly infrastructure access fees, and the Company’s plans
    to continue to aggressively drive sales of BlackBerry 7 handheld devices. The Company expects to report an
    operating loss in the second quarter of fiscal 2013, as RIM continues to invest in marketing programs and
    continues to work through the transition to BlackBerry 10, as well as the Company’s fixed costs being
    allocated over a lower volume of shipments. This outlook excludes the impact of charges related to the CORE
    Program.

    3 Reconciliation of GAAP net loss and diluted loss per share to adjusted net loss and adjusted diluted loss per share:
    (United States dollars, in millions except per share data)
    Net Loss (net
    of income tax)
    Diluted EPS
    (net of
    income tax)
    As reported $ (0.99) (518) $
    Adjustment:
    Impairment of Goodwill
    (1)
    0.62 326
    Adjusted $ (0.37) (192) $
    Three months ended June 2,
    2012

    Note: Adjusted net loss and adjusted diluted loss per share do not have a standardized meaning prescribed by
    GAAP and thus are not comparable to similarly titled measures presented by other issuers. The Company
    believes that the presentation of adjusted net loss and adjusted diluted loss per share enables the Company and its shareholders to better assess RIM’s operating results relative to its operating results in prior periods and improves the comparability of the information presented. Investors should consider these non-GAAP measures in the context of RIM’s GAAP results.

    (1) During the first quarter of fiscal 2013, the Company performed a goodwill impairment test and based
    on the results of that test, the Company recorded a pre-tax, non-cash goodwill impairment charge of
    approximately $335 million, or $326 million after tax.
    Conference Call and Webcast

    A conference call and live webcast will be held beginning at 5 pm ET, June 28, 2012, which can be accessed
    by dialing 1-800-814-4859 (North America), (+1)416-644-3414 (outside North America), or through your
    personal computer or BlackBerry® PlayBook™ tablet at Research In Motion - Investor Events. A replay
    of the conference call will also be available at approximately 7 pm ET by dialing (+1)416-640-1917 and
    entering pass code 4501363#. A replay of the webcast will be available on your personal computer or
    BlackBerry PlayBook tablet by clicking the link above. This replay will be available until midnight ET, July
    12, 2012.

    About Research In Motion
    Research In Motion (RIM), a global leader in wireless innovation, revolutionized the mobile industry with the
    introduction of the BlackBerry® solution in 1999. Today, BlackBerry products and services are used by
    millions of customers around the world to stay connected to the people and content that matter most
    throughout their day. Founded in 1984 and based in Waterloo, Ontario, RIM operates offices in North
    America, Europe, Asia Pacific and Latin America. RIM is listed on the NASDAQ Stock Market (NASDAQ:
    RIMM) and the Toronto Stock Exchange (TSX: RIM). For more information, visit RIM Company - Learn about Research In Motion or
    Cell Phones, Smartphones & Mobile Phones from BlackBerry.com.



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    I can understand them saying the code is blah, blah, blah...

    But we've heard this before...with the the co-CEO's...and look where it got them. Delays...delays...delays..

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    Joe Jerde's Avatar
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    I think it's mostly based on the lack of Apps. RIM needs to close the app gap to swoon over iOS and Android users back to BB.

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    Yeah, but with this kind of reporting, swooning back deserters and luring other platform users is a tough mountain to climb.
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    babbguy is offline BlackBerryOS Noobie
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    As a long suffering Mac user back in 1998 I endured all sorts of ridicule over staying with the Mac (still do) in some circles. As long as RIM delivers anything close to what I have seen I will buy a new BB10! We need a competitor to the un-secure Android and the new Dark Empire.
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    Hello babbguy, welcome to BBOS!

    Good points. I agree that BB10 will be amazing. It will be pushing outdated devices for the next 6 months that will be their biggest challenge. From what Thorsten has said today, there really is no solution from now till BB10 besides selling a bunch low end devices.

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    rafiki is offline BlackBerryOS Inspired
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    Sure, Joe, but with now maybe 10-12 months to go before the new phone/software will be on the shelves can RIM continue to sustain losses of this magnitude? I fear they can't.

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