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Demand drop? RIM net dips 59%

Shares of Research in Motion (RIM) plunged 19% in early trading on Friday after the BlackBerry maker reported sales and profits that fell short of expectations.

business Updated: Sep 16, 2011 22:01 IST

Research In Motion Limited (RIM), the maker of BlackBerry smartphones, has reported a nearly 59% decline in net income to $329 million for the three-month period ended August 27.

The company had posted a net income of $797 million for the June 28-August 27 period last year, RIM said in a statement.

Revenue for the June 28-August 27 quarter of the 2012 fiscal stood at $4.2 billion, down nearly 9% from $4.6 billion in the same quarter last year.

During the quarter, RIM shipped approximately 10.6 million BlackBerry smartphones and approximately 200,000 BlackBerry PlayBook tablets.

"We successfully launched a range of BlackBerry 7 smartphones around the world during the latter part of the second quarter and we are seeing strong sell-through and customer interest for these new products. Overall unit shipments in the quarter were slightly below our forecast due to lower than expected demand for older models," RIM Co-CEO Jim Balsillie said.

The company's total cash, cash equivalents, short-term and long-term investments amounted to $1.4 billion as of August 27, 2011, compared to $2.9 billion at the end of the previous three-month period.

Going ahead for the third quarter of the 2012 fiscal ending November 26, 2011, the company expect revenues to be in the range of $5.3-5.6 billion.

BlackBerry smartphone shipments in the August 28-November 26 quarter are estimated to grow between 27-37% vis-a-vis the second quarter.