RIM posts strong Q3, updates restatement plans

Research In Motion Ltd. said that new product launches helped fill its sails as the company reported robust revenue and earnings in its fiscal third quarter, despite an ongoing, internal review of its stock option grants that may lead to extensive restatements of past earnings.
RIM reported last week that it brought in $835 million in revenue during its fiscal third quarter, up 49 percent from the year-ago quarter, and $176 million in net income, a nearly 47-percent jump compared with the year-ago quarter. The company added about 875,000 subscribers to its service during the quarter, bringing its total subscriber base to about seven million.
RIM’s shares dipped 3 percent the day after it reported third quarter results, possibly reflecting its projection for a range of earnings per share for the fourth quarter that largely falls below analysts’ consensus forecast.
About 75 percent of RIM’s revenue comes from the sale of its handsets and about 17 percent derives from its services, according to the company. (Five percent derives from software and 3 percent is attributed to “other” sources.)
Among the third quarter’s highlights, according to the company: the launch of its consumer-oriented BlackBerry Pearl at T-Mobile USA Inc. and Cingular Wireless L.L.C. and the launch of its BlackBerry 8703e at Verizon Wireless and Sprint Nextel Corp.
RIM forecast $900 million to $940 million in fourth-quarter revenue and expects to add 950,000 to 975,000 subscribers in that period.
The company said in an update on its review of past stock option grant practices that only the second and third quarter reports made in September and last week, respectively, and for the full fiscal year 2006 would definitely not be affected by any restatements. Those restatements are expected to be made by March 3, 2007, the end of fiscal 2006, the company said.