Fin24

RIM stock sinks on profit plunge

2011-12-16 11:53

San Francisco - BlackBerry maker Research In Motion on Thursday saw its stock price sink after reporting a plunge in quarterly earnings and dimmed expectations for the months ahead.

The Canada based firm reported a profit of $265m, or 51 cents per share, on revenue of $5.2bn as compared with a net income of $911m in the same quarter last year.

RIM profit in the quarter ended November 26 fell far short of Wall Street forecasts and the stock price dropped more than six percent to $14.13 in after-hours trading that followed release of the figures.

RIM said it had yet to finalise its outlook for the current fiscal quarter but preliminary estimates were that device shipments would slide and that it would not meet its original forecast of earning $5.20 to $6 per share.

A costly BlackBerry service outage and deep discounting of the price of its PlayBook tablet computer were cited as factors in RIM's disappointing financial performance.