RIM Reports Profits Up, But Lowers Expected Subscriber Growth
Research In Motion, maker of the popular BlackBerry mobile E-mail device, reports that third-quarter profits rose by a third.
Research In Motion Ltd, makers of the popular Blackberry mobile email device, reported on Wednesday that profits in the third quarter rose by a third, but the company, which is embroiled in a patent dispute, lowered its subscriber forecast.
The Canadian company said net income for the quarter ended Nov. 26 was $120.1 million, or 61 cents a share, compared with $90.4 million, or 46 cents a share, for the same period a year ago. Revenues rose by 53 percent to $560.6 million from $365.9 million.
RIM added about 645,000 new subscribers, ending the quarter with 4.3 million customers. The company maintained its revenue guidance of between $590 million and $620 million for the fourth quarter, but lowered its previous forecast of subscriber additions to a range of 700,000 to 750,000.
The profit forecast remained in the range of 76 cents to 81 cents a share.
In its dispute with patent holding company NTP Inc., RIM said it was difficult to estimate any future settlement or costs associated with the litigation, but said it would maintain for now its previous estimate of $450 million.
NTP claims RIM has infringed on several patents, including NTP's radio-communications technology. A Virginia federal court ruled against RIM in 2003, but that decision was reversed on appeal and sent back for reconsideration.
The court rejected this month RIM's argument that NTP should be forced to abide by a $450 million settlement it had agreed to in March, but later backed out of. The ruling opened up the possibility that the court could ban RIM from providing Blackberry service in the United States.
RIM has said it is ready to make changes to its technology to avoid the alleged patent infringement, if it loses in court. The company expects the changes to allow it to keep operating in the United States.
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