An aging line of smartphones coupled with shaken credibility led to Research in Motion shares falling 13 percent Friday morning. The slide was prompted by RIM Thursday cutting its shipment and sales forecast amid heated competition by Apple and Google’s Android.
“This further damages already low credibility, making them the ‘poster boy’ for a show-men story from here,” RBC Capital Markets’ analyst Mike Abramsky tells Bloomberg. RIM announced BlackBerry shipments would likely reach the low side of its previously-forecasted 13.5 million to 14.5 million units. Likewise, quarterly sales would be “slightly below” its earlier projection of $5.2 billion to $5.6 billion.
“They are getting hit by a combination of a stale portfolio and heated competition on devices,” Matt Thorton of Boston-based Avian Securities LLC told the news service. Perhaps such comments caused Co-CEO Jim Balsillie to tell analysts “the issue is an aging that happens in your higher-end products that affects your margin.”
RIM’s smartphone marketshare fell to 14 percent in the fourth-quarter of of 2010, down from 20 percent during the same period a year ago. By comparison, Android tripled its market share to 33 percent while Apple remained steady at 16 percent of the market, according to Canalys.
While another analyst suggested RIM revive its brand by adopting the Android operating system, Balsillie instead said the company would begin focusing on less-expensive BlackBerry models.
Monday, RIM opens the BlackBerry World conference in Orlando, Florida. As Disney revitalized the theme park, many are hoping the Waterloo, Ont.-based RIM can pump life into a self-described “aging” product.
Ed Sutherland is a veteran technology journalist who first heard of Apple when they grew on trees, Yahoo was run out of a Stanford dorm and Google was an unknown upstart. Since then, Sutherland has covered the whole technology landscape, concentrating on tracking the trends and figuring out the finances of large (and small) technology companies.
