High Bar Hits RIM

RIM also crossed the 10 million subscriber mark as total BlackBerry subscriber account base at the end of the second quarter was approximately 10.5 million.

International markets represent approximately 32% of RIM's subscriber account base, and the percentage of subscribers coming from non-enterprises increased to over 30% of the company's base.

For the third quarter, RIM expects revenue of $1.6 billion to $1.67 billion. Subscriber account additions in the third quarter are expected to be approximately 1.65 million, and the company forecast earnings in the range of 59 cents to 63 cents a share.

Analysts were expecting revenue of $1.51 billion and EPS of 55 cents a share.

Despite some analyst fears, RIM managed to keep the average selling price of its devices in the second quarter higher than expected, at approximately $353. In the third quarter, the company expects the average selling price for a device to decline to $340.

Service revenue in the second quarter was $201 million, or 15% of overall revenue. Software revenue was $57 million, or 4% of revenue. Other revenues from repairs and the sale of accessories totaled $36 million, or 3% of revenue.

Gross margin for the first quarter was just over 51%, in line with the company's guidance.

RIM ended the quarter with approximately $1.7 billion in cash, cash equivalents and investments, up $166 million from the prior quarter. The cash stockpile has drawn management attention, Jim Balsillie, CEO of RIM told analysts in a conference call.

"There will come a time in the not too distant future when we have to come up with a cash strategy, whether it is buybacks or dividends or whatever is appropriate, but it is not something that's fully thought through," said Balsille. "It is something that has been put on my agenda to address with the board and the audit committee, and once we get greater clarity than that, we'll do it."