RIM: We’re Not $0 Per Share Just Yet!
Research In Motion (NASDAQ:RIMM) chief executive Thorsten Heins went on the defensive on Tuesday, telling a Canadian radio station that he didn’t believe the company was in a “death spiral” and that “there’s nothing wrong with the company as it exists right now”.
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Last week, RIM released quarterly results that showed operating losses of $643 million after the company’s handset shipments dipped to their lowest level since 2009. It also said that it would lay off about 5,000 employees as it tries to cut costs. The company’s stock has dipped over the past few months in the face of fierce smartphone competition from Apple’s (NASDAQ:AAPL) iPhone and Google (NASDAQ:GOOG) Android devices. It is also said to be discussing strategic options with advisory financial firms.
“I’m not talking about the company as I, kind of, took it over six months ago,” Heins told CBC’s Metro Morning radio show on Tuesday. “I’m talking about the company (in the) state it’s in right now.” He added that he was not ignoring threats. “Yes, it is very, very challenged at the moment — specifically in the US market. The way I would describe it: we’re in the middle of a transition.”
Heins took over in January after the board got rid of co-founders Mike Lazaridis and Jim Balsillie from their positions as co-chief executive and co-chairman. Heins added on Tuesday that RIM had made massive changes to its management and business objectives since he took charge, and that sales in other parts of the world remained strong. “All that is in the making, it is in the works. This company is in the middle of it and I’m positive we will emerge successfully from that transition.”
Heins also said that the launch of BlackBerry 10, pushed back to next year, will be a completely new way for RIM to address mobile computing.
On Tuesday, Barclays lowered its expectations for the company, arguing that RIM had an “ebbing competitive position” that put earnings estimates at risk. “We model a loss of $1.04 versus a consensus of a three-cent gain in full-year 2014,” analyst Jeff Kvaal wrote in a note.
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