Updated from 7:51 a.m. EDT
Research in Motion
surged toward $200 on Friday, stealing a small bit of thunder from
RIM was recently up $27.60, or 16.7%, to $193.19.
Late Thursday, RIM reported that first-quarter net income grew to $223.2 million, or $1.17 a share, from $129.8 million, or 68 cents a share. Earnings per share figures included stock-based compensation and shattered the company's guidance and analysts' consensus estimate of $1.06 a share.
Following the numbers, both Bank of America and JMP Securities upgraded the stock on Friday.
RIM is looking for sales momentum as its girds to battle Apple's hugely anticipated iPhone, which debuts later Friday, for the market of high-end cell phones.
A slew of new Blackberry models helped boost revenue by 76.5% to $1.08 billion, topping estimates. This was the first full quarter in which the 8800 enterprise BlackBerry was available. During the quarter, RIM introduced its sleek, consumer oriented Curve and the 8830 World Edition, which works on networks in the U.S. and abroad.
The total number of subscriber accounts in the quarter jumped by approximately 1.2 million to over 9 million.
"We are starting fiscal 2008 with strong operating performance, including record revenue, earnings and subscriber results," said co-CEO Jim Balsillie in a statement. "This growth is a testament to our strong portfolio of products and services and our successful channel expansion."
In a conference call for analysts, Balsillie said the company is planning to launch up to three new models toward the late summer and early autumn. He indicated that new BlackBerrys would have more multimedia features, including possibly a touch-screen feature similar to the iPhone.
RIM has pursued an aggressive pricing strategy, keeping new models at about $199 after rebates as it vies for more a greater slice of the consumer market. The company currently derives about 75% of its revenue from business users. As this percentage has fallen with the addition of consumer accounts, RIM said its average selling price has declined or remained flat in previous quarters.
The effect is showing up in RIM's gross margins, which contracted to 51% in the first quarter from 55% a year earlier and 53.5% in the previous quarter.
RIM expects its average selling price to decline in the low-single-digits.
In the current quarter, RIM expects earnings per share of $1.37 to $1.49 a share, way above analysts' views of $1.12.
RIM expects revenue in the range of $1.3 billion to $1.365 billion, also well above expectations.
The company also announced a 3-for-1 stock split will be implemented by way of a stock dividend whereby shareholders will receive two common shares of the company.