RIM Slashes Guidance, Hires Bankers
NEW YORK (TheStreet) -- Shares of Research In Motion(RIMM) were sharply lower in late trades on Tuesday after the BlackBerry maker forecast an operating loss for its fiscal first quarter and said it's hired bankers to help with its review of its strategic options.
The stock was last quoted at $9.84, down 12.4%, on volume of nearly 800,000, according to Nasdaq.com.
Beyond saying the company would report a loss, CEO Thorsten Heins did not provide specific guidance. He added that Research In Motion's expects its "financial performance will continue to be challenging for the next few quarters" and said more detail would be available when the results for the quarter are released June 28.
According to Thomson Reuters, Wall Street is looking for first-quarter earnings of 49 cents per share on $3.65 billion in revenue in the first quarter.
"In terms of challenges, as I mentioned on the March financial results conference call, RIM is going through a significant transformation as we move towards the BlackBerry 10 launch, and our financial performance will continue to be challenging for the next few quarters," Heins said. "The on-going competitive environment is impacting our business in the form of lower volumes and highly competitive pricing dynamics in the marketplace, and we expect our Q1 results to reflect this, and likely result in an operating loss for the quarter."
The company announced there will be "significant spending reductions and headcount reductions in some areas throughout the remainder of the fiscal year," but again did not provide specific numbers.
Heins also noted that these actions will increase its cash position from the end of 2012, when it had approximately $2.1 billion in cash.
Shares of RIM closed the regular session up 2.09% to $11.23.
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--Written by Chris Ciaccia in New York