The Waterloo, Canada-based maker of the popular BlackBerry handheld devices, also issued sales and earnings guidance that topped Wall Street estimates, with RIM shares up 7.9% at $38.29.
For the second quarter ending August 30, the wireless email vendor posted net income of $2.1 million, compared with a net loss of $14.2 million, on revenue of $125.6 million, up from $73.4 million in the year-ago quarter. The revenue was slightly above Wall Street’s consensus estimate of $122.8 million. Cash and cash equivalents increased to $369.7 million.
During the quarter, the number of BlackBerry subscribers increased by 96,000 to a total of 711,000 subscribers. Of RIM’s total sales, 53% came from handhelds, 32% from services, 9% from software licenses, and 6% from OEM radios and other categories.
The strong sales during the quarter was helped by an upgrade cycle among subscribers, as well as the rollout of new lower-priced products. This is borne out by the fact that average selling prices slid from $410 in the prior quarter, to $370 in the just-completed quarter.
Looking forward, the increased demand for 2.5G BlackBerry models, means that RIM has substantially upped guidance for the fiscal third quarter, from a range of $115 million to $125 million to a higher range of $140 million to $150 million. Wall Street analysts had expected only $128 million. And in the fourth quarter, RIM outlines likely sales of $150 million to $160 million, well above current expectations for $134 million.
The company also expects to add 115,000 to 125,000 net subscribers in the current quarter, for a total of more than 825,000 BlackBerry users.
The above figures are remarkable when you consider that RIM is still, relatively speaking, a small company with annual revenue of approximately $300 million. Revenue growth of 71% is worth noting, especially at a time when most of the major tech companies are reporting flat quarter-over-quarter sales.
This article was based on material originally published by ComputerWire.
