“Research In Motion Ltd delayed the make-or-break launch of its next-generation BlackBerry phones until next year, in a devastating setback to the once-dominant technology company whose sales are crumbling,” Alastair Sharp reports for Reuters. “Shares of the company, which also announced a steeper-than-expected quarterly operating loss and deep job cuts on Thursday, plunged 14 percent after it said it would release its revamped BlackBerry 10 devices early in 2013. It conceded the development had ‘proven to be more time-consuming than anticipated.'”
“The size of the loss, RIM’s first in eight years, and the likelihood that sales will keep sliding into 2013, severely reduce the options for the company if it is to survive,” Sharp reports. “RIM’s announcement that it would slash 5,000 jobs, or 30 percent of its workforce, only reinforced the impression of a company that could be in terminal decline. ‘It’s like watching a puppy die. It’s terrible,’ said analyst Matthew Thornton of Avian Securities in Boston.”
MacDailyNews Take: More like, an ugly, demented, 28-year-old dog that should’ve been put down long ago. Puppies are new; there’s nothing at all new about beleaguered RIM.
Sharp reports, “‘Wow, what a disaster,’ said Edward Snyder, managing director of Charter Equity Research in San Francisco. RIM is now in ‘a handset death spiral,’ he said. ‘From a numbers point of view, it could hardly be worse, and it’s going to deteriorate from here,’ he said.”
MacDailyNews Take: Told ya so – two years ago. DCW.
Sharp reports, “Now the new BlackBerry line will miss both the back-to-school and Christmas shopping periods, while the competition brings out new phones with more bells and whistles. Apple is widely expected to unveil an iPhone 5 later this year… RIM’s board is under mounting pressure to consider unpalatable options such as selling its network business or forming an alliance with Microsoft, sources familiar with the situation told Reuters. Microsoft CEO Steve Ballmer approached RIM earlier this year looking to strike a partnership similar to the one the software giant has with Nokia Oyj, the sources said.”
MacDailyNews Take: There’s a fun choice: Death, or a fate worse than death?
Sharp reports, “Freshman CEO Thorsten Heins gave no indication on a Thursday conference call that he was losing faith in the current tack of cutting costs while waiting for the BlackBerry 10 launch, which is now more than a year overdue. The new devices are now set to land in a slow period when consumers are tapped out after their holiday spending. ‘It’s akin to launching fireworks underwater,’ said IDC analyst Kevin Restivo.”
MacDailyNews Take: Good one, Kevin! (The analysts are really digging deep for good analogies on DCW.)
Sharp reports, “Shares of RIM, which have dropped about 70 percent over the past year, were down 14 percent at $7.86 in after-hours Nasdaq trading. At that price, the market is valuing the company at $4.12 billion, a far cry from its once-lofty market capitalization of about $84 billion.”
MacDailyNews Take: Currently, Apple Inc. is worth 131 times the value of RIM. Amateur Hour, indeed.
Sharp reports, “RIM said it expected to post another operating loss in the current quarter, as it ships fewer smartphones… RIM sent out 260,000 of its poor-selling PlayBook tablet computers, which it has discounted sharply after initially pricing them at levels comparable with Apple’s iPad… RIM said last month it would no longer produce the cheapest model of the PlayBook.”
MacDailyNews Take: Where’d they send ’em, to the landfill?
Read more in the full article here.
MacDailyNews Take: Our condolences to the affected employees.
This is what the bloodbath looks like and it is also a valuable lesson. Sitting on your laurels while being led by people with their heads in the sand (RIMs former half-CEOs are each just recently $12 million richer from RIM, by the way) is a recipe for total disaster.
May you land on your feet and quickly find work at an innovative, thriving, company for a change!
Beleaguered RIM delays BlackBerry 10 OS until 2013 – June 28, 2012
Why beleaguered RIM won’t be bought: Not much value in a dying platform – June 26, 2012
Former half-CEOs Balsillie, Lazaridis pocket $12 million in ‘entitlements’ from beleaguered RIM – June 15, 2012