Updated from June 25
SAN FRANCISCO -- Shares of BlackBerry maker
Research in Motion
(RIMM) plunged after the company missed Wall Street's first-quarter expectations and guided below profit estimates for the second quarter.
Shares of RIM sank 8.5% to $130.18 in premarket trading Thursday.
RIM said first-quarter profit rose to $482.5 million, or 84 cents a share, compared with a net income of $223.2 million, or 39 cents a share, a year earlier.
Revenue rose 107% to $2.24 billion from $1.08 billion a year ago.
Cramer: RIM's Still Got Juice - Buy Now
Analysts polled by
were expecting revenue of $2.27 billion and earnings of 85 cents a share.
Approximately 2.3 million BlackBerry subscriber accounts were added in the quarter, bringing the total BlackBerry subscriber account base to more than 16 million. RIM had forecast net subscriber account additions to be approximately 2.2 million during the quarter.
Nearly 60% of the subscriber additions in the quarter came from non-business users and they now represent about 40% of RIM's total user base, the company said.
But it was the spike in expenses and a decline in gross margins that had analysts on the company's conference call worried.
Gross margin for the quarter fell to 50.7% from 51.8%, the same quarter a year ago.
The company's selling, general and administrative expenses grew 22%, compared to expectations that pegged the rise at around 17% to 18%. That means the company spent about $10 million more than it had expected, pointed out Citigroup analyst Jim Suva.