Research In Motion's (RIMM) third-quarter results broadly met expectations, but the company reduced fourth-quarter financial guidance, citing a slow launch of new services by partners.
The Canadian mobile email device maker lost 8 cents a share, matching estimates, on $70.9 million in revenue. The top-line number fell short of analysts' $72 million consensus forecast, according to Multex.com. Revenues fell 11% sequentially but rose 14% from a year ago.
RIM cautioned investors to temper expectations for the fourth quarter because of pushouts in its partners' launches of GPRS services in the U.S. and in Europe. RIM sees fourth-quarter revenue at $65 million to $70 million, $10 million below its earlier range; it also expects a wider loss of 13 cents to 15 cents a share. The device maker believes GPRS services will be unveiled in its first quarter, leading revenue to rebound to a range of $75 million to $80 million.
"We continue to see slippage in the GPRS launch," said CFO Dennis Kavelman, who added that RIM's previous hopes of a holiday season launch were aggressive. "It's more reasonable to expect them in late Q4 and Q1."
RIM shares dropped 7% to $19.75 before the release of the report Thursday evening.
RIM was spurred into the red by large increases in research-and-development and sales expenses. Net R&D spending jumped 38% as part of an expensive effort to create wirelessly connected devices for an increasing number of mobile phone network technologies. Selling and general administrative expenses spiked 52%. Still, the company retains $656 million in cash.
Management expects R&D and SG&A spending to go up another 10% to 15% in the next quarter, as RIM formulates products for the GPRS, CDMA and iDEN markets.
After market's close, RIM unveiled another carrier partnership, pairing with
to provide BlackBerry wireless handsets for the wireless provider's iDEN technology-based network. Nextel offers a popular local walkie-talkie-style voice service to businesses; BlackBerry devices would add wireless email to Nextel's offerings.