When RIM’s ex joint CEOs – Mike Lazaridis and Jim Balsillie resigned in January, I questioned whether the move was ‘too little, too late’ to save the appalling downfall of the Waterloo giant. None the less, there was no doubt that RIM’s new top boss Thorsten Heins had his work cut out and he’d need to act fast if RIM is to survive.
To be honest, it would have been unfair to expect Heins and company to turn things around for the struggling RIM in two months. The writing was on the wall that RIM would soon be reporting another listless quarter, especially after the company announced that it would delay its annual presentation to financial analysts until the release of BlackBerry 10.
Therefore, it was no surprise that the BlackBerry smartphone maker this afternoon reported lower-than-expected revenues and profits for its fiscal fourth quarter, and warned that pressure on its business will continue. More importantly though, RIM announced that it’s going back to the drawing board to do a review of “strategic opportunities” including partnerships and joint ventures, licensing, and other ways to leverage the company’s assets and maximize value for stakeholders.
And for academic interest, Jim Balsillie, former co-chief executive resigned from his seat on RIM’s board of directors.
RIM made a net loss for the three months to 3 March of $125 million compared with a profit of $934 million a year earlier. Revenues fell to $4.2 billion – 19 per cent lower than the third quarter and well below the Waterloo giant’s guidance of at least $4.6-billion. BlackBerry sales were 11.1 million, down by 21 per cent from last quarter. The company sold 500,000 PlayBooks, thanks largely due to continued discount schemes. RIM’s net profit for the year was $1.2 billion, a sharp decline from the $4.3 billion last year.
Though CEO Thorsten Heins believes the “best way to drive value is to execute our plan to turn around” the company, he didn’t rule out the possibility of an outright sale. He emphasized that RIM will plan to refocus on the enterprise business and capitalize on its leading position in this segment. He says licensing BlackBerry software to other technology companies remains a definite possibility as part of a strategic review process.
“I did my own reality check on where the entire company really is. Having had the benefit of going through this process from the vantage point of CEO, it is now very clear to me that substantial change is what RIM needs,” chief executive Thorsten Heins said in a conference call with analysts.
On a separate note, Jim Balsillie said he believed it was the right time to pass the baton to new leadership, although he remains a significant shareholder within the company. RIM also announced that David Yach’s – the company’s chief technical officer is retiring after 13 years with the company while Jim Rowan, chief operating officer, global operations, is also leaving to pursue other interests.