June 25, 2003 4:13 PM PDT
RIM reports net loss, rise in revenue
The Waterloo, Ontario-based company said it generated revenue of $104.5 million in its fiscal first quarter ended May 31, compared with $71.6 million in the same quarter a year ago. It lost $8.2 million, or 11 cents a share, in the quarter, which compares with a loss of $10.7 million, or 14 cents, in the year-ago period.
Analysts were expecting a loss of 9 cents a share, according to a survey by financial research firm First Call.
RIM sells wireless devices and server software. It gets a cut of service revenue for wireless network access for its handhelds--mainly its BlackBerry device. The company is beginning to license its software to device makers looking to make their portable products stand out from those of competitors. A smaller portion of its business comes from selling radio transmitters.
RIM reported an increase of 81,000 subscribers to its wireless messaging service in the first quarter, for a total of 615,000 subscribers.
"RIM continues to grow its business and strengthen its market position through close-knit alliances with leading product and service providers," Jim Balsillie, chairman and co-CEO, said in a statement. "Together with our partners, we are expanding the global reach of the BlackBerry platform through new product, distribution and licensing initiatives."
Balsillie added that about two-thirds of the new subscribers from the quarter had signed up for voice-enabled BlackBerry devices, which means higher revenue opportunities for potential new cellular carrier partners. Voice service is generally more profitable for carriers than data service.
Handhelds brought in about 50 percent of RIM's revenue, while service made up 37 percent. Software licenses accounted for 6 percent, and radios and other sources made up 7 percent.
RIM beat its first-quarter revenue guidance and raised its estimates of $95 million to $105 million for the current second quarter to between $105 million and $115 million. The company said it expected adding 80,000 to 100,000 subscribers for a total of around 700,000 new customers to its service. RIM also forecast revenue between $115 million to $125 million for the third quarter.
RIM has less than 2,000 employees, according to Chief Financial Officer Dennis Kavelman. The company had cash and cash equivalents of $351 million as of May 31.
Separately, RIM announced the appointment of John Richardson to its board of directors. Richardson is the seventh member of the board. Richardson's appointment was effective May 30. He is currently the chairman of the audit committee for the Ontario Pension Board and is also chairman of the Boiler Inspection and Insurance Company.
RIM closed up 68 cents, or 3 percent, to $22.83 per share. In after-hours trading, the company was up 23 cents, or 1 percent, to $23.06.