Jun 28, 2012 / 1:55 pm
Research In Motion Limited (TSX:RIM) said Thursday that it is cutting 5,000 jobs as it restructures its operations and that the launch of its much anticipated BlackBerry 10 smartphone will not happen until the beginning of next year.
The launch of the new smartphones, seen as key to the recovery of the company, had been expected later this year and will now miss the important holiday shopping season.
"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," said chief executive Thorsten Heins in a release.
"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."
RIM shares plunged 16 per cent in after-hours trading on the Nasdaq, losing US$1.50 to US$7.63. Shares closed up two cents at C$9.46 on the Toronto Stock Exchange in regular hours trading Thursday.
The company, which reports in U.S. dollars, announced the cuts and delays as it reported a loss of US$518 million or 99 cents per share for its latest quarter. The loss compared with a profit of $695 million or $1.33 per share a year ago.
Revenue for the three months fell to $2.81 billion from $4.91 billion.
Excluding one-time items including a non-cash charge to goodwill, the company said it lost $192 million or 37 cents per share diluted.
Analysts polled by Thomson Reuters expected RIM to post a loss of a three cents per share, while its revenues will fall about 37 per cent to $3.1 billion.
During the quarter, RIM shipped 7.8 million BlackBerry smartphones and approximately 260,000 BlackBerry PlayBook tablets.
In its outlook, the company said it expects the next several quarters to continue to be very challenging for its business.
RIM said it 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.
Uncertainty has engulfed the future of RIM in recent months as speculation swirls over whether the company could be bought, or forced to sell off certain pieces of its operations to survive.
The company has been strongly criticized for delaying BB10, but executives have insisted they want to get this right rather than face an onslaught of bad reviews, like those that came after it rushed the releases of the BlackBerry Storm touch screen and the PlayBook tablet.
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