NEW YORK (TheStreet) -- Research In Motion's (RIMM) fiscal first-quarter was eye opening, not just because of the company's turgid bottom line, but because of how fast its losses are accelerating. This may be the end of the line for the Canadian firm, according to several analysts.
The handset maker reported a much wider than anticipated loss for its fiscal first quarter, pushed back the launch of the BlackBerry 10 until the first calendar quarter of 2013 and announced plans to lay off 5,000 employees, roughly 30% of its workforce.
RIM's rocky road looks like it's come to an end
The company had essentially been betting its fortunes on the BlackBerry 10 platform, so to push it back past the holiday selling season doesn't inspire confidence, says Barclays Capital analyst Jeff Kvaal.
"We believe further delays are possible given RIM's history (the first QNX phones were initially expected in 2H11). The company expects to report another operating loss in F2Q. We expect operating losses to extend well into FY14," Kvaal wrote in his research report. He rates shares "neutral," but lowered his price target to $6 from $8.RIM Plunges on Loss; BB10 Delay: Live Blog Recap CEO Thorsten Heins is confident that the BlackBerry 10 platform will be successful, even as companies like Apple (AAPL) and Google (GOOG) dominate the smartphone market with their iOS and Android platforms, respectively. "When we designed BlackBerry 10, we didn't just design a product, we designed a platform - very high-end specs. I am very confident that this product will deliver on its performance," the CEO noted on the conference call. William Blair analyst Anil Doradla doesn't see it that way, and thinks RIM already has "one foot in the grave." Doradla believes that RIM is facing an uphill battle, which it's unlikely to survive, much less win. "More importantly, we cannot think of any situation in the history of mobile handsets when a company recovered from this level of strategic error and market loss," Doradla wrote in his note. "Additionally, at this stage we believe the Blackberry 10 is too little, too late." Doradla rates shares "market perform."
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