Tonight’s RIM earnings call could be one of the most stressful ever for RIM co-CEO Jim Balsillie.
Join us here for LIVE coverage beginning at 4:00 p.m. ET, including live coverage of RIM’s call at 5 p.m. ET.
The BlackBerry maker has seriously started to lose faith on Wall Street — shares are down 40% since mid-April, and short interest has doubled — and Balsillie is going to have to explain tonight why the BlackBerry story isn’t screwed.
(Actually convincing anyone, meanwhile, is a different story. Don’t forget that last quarter, Balsillie promised things that were a “quantum leap over anything that’s out there.”)
Everyone is going to have their eyes on RIM’s guidance, to make sure the company still thinks it can grow (and maintain its margins) as competition intensifies with Apple and Google. Specifically, keep your eyes on RIM’s gross margin guidance — anything well below 43% could be trouble — and its net subscriber addition forecast for the November quarter, which needs to be above 5 million.
What’s the problem?
RIM, long a leader in the fast-growing smartphone industry, has lost most of its mindshare in the high end of the market to Apple’s iPhone and phones based on Google’s Android operating system. While RIM is still selling plenty of phones, and is still growing in international markets, it’s at severe risk of being banished to the low end of the market, which could punish BlackBerry margins. Even RIM’s long-time enterprise customers are starting to experiment with other platforms.
RIM has responded with the new BlackBerry Torch, which sort-of looks like an old iPhone, but it hasn’t been enough. There’s more on the horizon, including a BlackBerry tablet of some sort, but it’s going to be very challenging for RIM to compete with Apple and Google having such inferior software.
For now, join us here for LIVE coverage beginning at 4 p.m. ET.
Key Stats: (data via Yahoo! Finance and Citi Investment Research)
Aug. qtr. revenue: $4.47 billion consensus
Aug. qtr. EPS: $1.35 consensus
Aug. qtr. net additions: 5.0 million consensus
Aug. qtr. units: 11.7 million consensus
Nov. qtr. revenue: $4.83 billion consensus
Nov. qtr. EPS: $1.39 consensus
Nov. qtr. gross margin: 42.6% consensus
Nov. qtr. net addition: 5.2 million consensus
Related: RIM Is The New Palm
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