BlackBerry 10 delayed, RIM future in doubt after bleak earnings report

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BlackBerry fans: It just got worse. BlackBerry maker Research in Motion (RIM) announced that the BlackBerry 10 smartphone and BlackBerry 10 operating system's launches will be delayed, 30 percent of RIM employees will be laid off and that RIM posted a loss of $518 million in the latest quarter.

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The Waterloo, Ontario company announced the bad news in its fiscal first quarter report on Thursday, prompting shares to tumble 15 percent to $7.75 in late trading. BlackBerry 10 was widely seen as the company's last hope to catch up with rivals Apple and Android. Smartphones running Google's Android platform accounted for 59 percent of the global market in the first quarter of 2012, with Apple's iPhones taking 23 percent. BlackBerry's share of the global market was 6.4 percent, compared with 13.6% a year ago.

BlackBerry 10's launch has been postponed until the first three months of 2013, a delay of seven to nine months. Within that time, Apple will launch a new iPhone, Android developers will launch new phones running Ice Cream Sandwich and Jelly Bean and more Windows Phone 8 phones will be released. By the time BlackBerry 10 comes out it may be too late.

In an earnings call with analysts, CEO Thorsten Heins said building the BlackBerry 10 "has proven to be more challenging and time consuming than anticipated," and that a as result the expected 2012 launch "was no longer realistic."

"I will not deliver a product to the market that is not ready to meet the needs of our customers, or provide anything less than an outstanding user experience with the quality I expect a BlackBerry product to have," he said. "There will be no compromise on this issue."

Analysts were not impressed. Many believe RIM needs to take radical action to survive, such as switching to a Windows operating system or selling off RIM's intellectual property assets.

"In our view, the risk of total value destruction over the next few years is possible as at this point we cannot see the light at the end of the tunnel," said Bank of America/Merrill Lynch analyst Tal Liani.

"While all the key indicators continue to decline, management appears to be taking a 'damn the torpedoes, full speed ahead' approach to running the business," said Ehud Gelblum, an analyst at Morgan Stanley.

"We fear that the company could be driving 100 mph straight into a brick wall. We also worry that no company can operate normally, let alone develop, launch and market a brand new, company-wide and globally impacting platform while laying off nearly one-third of its workforce — it's just point of view."

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  News & Politics

[AznDuD333]

this is incorrect..smoking marijuana is considered a symbol for freedom

apple gives people no freedom.. people jailbreak for a reason..

[basilleonardo]

Blackberry is a great company with a great phone and millions of subscribers. It is the victim of rampant RIM-bashing, prolly American companies jealous of their UNPARALLELED security and quality calling and keyboard - if you can't beat 'em, bash 'em. Ooooh, they lost money ONE year, they lost $500 MILLION (even tho they MADE $2 BILLION), they won't release a new phone till it WORKS GREAT, they disappointed ANALysts (someone made up a number they didn't beat) ...what a bunch of a**holes- GO RIM!

[ladrun75]

Rim is gone no

Yahoo has dropped them from all in house communications.

[harpreetsingh2084]

they are going to launch blackberry 10 after the iphone 5 ....simple business strategy lets see whats new in iphone5 then quickly update bb10 with goodies which obviously will be ever so better than the iphone stuff.....there you have usp for bb...research in motion.

[tamyk007]

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[basilleonardo]

U don't get it, haven't you seen Wag the Dog? Some nob decides RIM is not working to their preferred schedule and some ANALyst makes up an earnings number they decide they should beat (Do you think there are any entities that have an interest in RIM going bust?), press and any dufus with a blog jump on the bandwagon, share drop...ooooh, RIM should dismantle itself and commit hari kari in shame. U have to think a bit.

[timmarrr234]

Seriously man, you sound like Heins Thorstein. I'm talking about product cycle, not about some innovation cycle or cycle of life. Look at Nvidia's line of GTX4xx and GTX5xx, they missed out by several months and the high end market was taken by the Radeon HD5xxx.

Apple sales are crazy high in China, India's population needs cheap phones and soon cheap Chinese Android phones will invade (or maybe it has) just like my country Indonesia which is pretty much Blackberry fanatic to the core.

[basilleonardo]

Evrything goes in cycles, RIM started it, Apple's on top now but the ANALists r already cmplaining they're not releasing anything NEW anymore. RIM has it's foot in the door in India..where's the most growth in the next 10 yrs, N.America or India? Any people there? RIM is just weathering constant attacks from the press - nothing's wrong w the company - they're just stuck in that crazy idea that quality is important. Now if they could just get Netflix working on Playbook...

[RCSonicjet]

..they were the ones who made up the number, their stock is down 500%, their CEO is delirious, and their adoption rate is far down, the market share is halving every quarter. The company at this point is holding the gun to it's head, if something big does not happen soon, the climbing dept will throw them into bankruptcy before the BB10 release.

[timmarrr234]

>they won't release a new phone till it WORKS GREAT

Yeah sure, when Galaxy Note 2, iPhone5, and WinPhone8 are going full force in Q1 2013, they are just starting up trying to catch up. Not to mention all the features in BB10 is not really tempting for user of other platforms to switch for. Being too late with product cycle can kill a company and this is the prime example of it.

[Evan Hyland]

i actually enjoyed the video , nice work asians :)