RIM has more than $2 billion in cash
RIM's shares rose 18% after hours
on Thursday after the Canadian manufacturer reported a smaller loss for its fiscal second quarter than estimated by Wall Street. The company, whose fortunes in the mobile phone business have been dropping, reported a loss of $235 million for the quarter versus a profit of $329 million reported last year while revenue declined 31% from $ 4.17 billion a year ago to $2.87 billion. RIM's per share loss worked out to 45 cents which was a penny better than the 46 cents a share loss expected by Wall Street analysts. Revenue also came in higher than the $2.5 billion that the Street was calling for. RIM ended the quarter with $2.3 billion in cash, up from $2.2 billion at the end of its first fiscal quarter. The company now has 80 million BlackBerry subscribers, picking up 2 million since the end of its fiscal first quarter.
During the quarter, RIM shipped 7.4 million BlackBerry handsets and 130,000 PlayBook tablets. Analysts were looking for RIM to ship a million fewer units. Overall, it was a great three months for BlackBerry
and the higher amount of cash on hand will enable the company to fully support the launch of its ambitious BlackBerry 10 rollout early next year. The OS will be available on both new all-touch models
and those featuring the iconic RIM QWERTY keyboard. It was during the company's last earnings report
when RIM announced that the launch of BlackBerry 10 would be delayed until the first quarter of 2013.
After-hours in NASDAQ trading, RIM is $8.43, up $1.29 or 18%. The 52 week high is $24.74.
"It's still bad, but it's a much smaller disaster than expected. These stocks all trade on expectations. Expectations were really low, and they were able to beat that. They shipped more than a million better than expected. They also lost a lot less money than expected, and the cash balance, even though they lost money, they were able to grow it slightly."-Shaw Wu, analyst, Sterne Agee.
RIM's stock price for the last year through Thursday's close