20-Jun-2011 13:04

Blackberry shares fall on poor results

Shares in Blackberry manufacturer Research in Motion (RIM) have fallen by more than a fifth since it announced disappointing results on Thursday.

The company said that it had missed even its lowered expectations and reduced its profit forecasts.

RIM's net profit was $695m (£430m) in the three months to 28 May, down from $769m in the same period last year.

It warned in April that its profits would be low because of lower shipments of its Blackberry phones.

RIM shares closed down by 21.4% on the Nasdaq exchange in New York.

The company has announced a cost-cutting programme, which will include job cuts.

"Fiscal 2012 has gotten off to a challenging start," said Jim Balsillie, joint chief executive of RIM.

"The slowdown we saw in the first quarter is continuing into Q2, and delays in new product introductions into the very late part of August is leading to a lower than expected outlook in the second quarter."

Immediately after the results were announced on Thursday company's shares fell sharply in after-hours trading and had to be suspended briefly.

"The guidance was just awful. The devices are receiving less shelf space and less support from carriers," said Peter Misek at Jefferies and Co in New York.

"People are not waiting. They're going to other platforms."

Research in Motion is struggling against new handsets produced by Apple or rivals using Googles Android operating system.

The company admitted that the release of its new devices would be delayed until later in the year.

Analysts were extremely critical of its performance.

(From BBC Business website information)