Research In Motion forecasts Q1 loss, layoffs, cost reduction on cards

Telecom Lead America: Research In Motion (RIM), maker of
BlackBerry smartphones, expects to post operating loss for the second-straight
quarter, due to on-going competitive environment, which is impacting its
business.

 

The company will review its organizational structure and
clearly define accountabilities for all key businesses. Furthermore, RIM will
lay off a large number of employees this year along with some major cost
reductions.

 

RIM has hired J.P. Morgan and RBC Capital
Markets to help it evaluate strategies, including possibilities of partnering
with other companies, opportunities in licensing software, and strategic
business model alternatives.

 

We are continuing to be aggressive as we compete for our
customers’ business – both enterprise and consumer – around the world, and our
teams are working hard to provide cost-competitive, feature-rich solutions to
our global customer base,” said Thorsten Heins, president and CEO of RIM.

 

In a business update, the company said that it is going
through a transformation and its financial performance will continue to be
challenging for the next few quarters.

 

RIM hires new COO from Sony Mobile and CMO from LightSquared

 

The company has also made some strategic changes in its
senior management team with the hiring of Kristian Tear as Chief Operating
Officer, whose background also includes extensive experience in international
sales in Europe, Asia and Latin America, and Frank Boulben as Chief Marketing
Officer.

 

The company expects to further increase its cash position
in Q1 from the approximately $2.1 billion at the end of fiscal 2012.

 

The company claims that it subscriber base continued grew
to approximately 78 million in the last quarter of 2012, driven primarily by
growth in international markets, which is partially offset by high churn in the
United States. Also, RIM’s BBM user base has grown to approximately 59 million
users globally.

 

The company recently enhanced its smartphone portfolio with
introduction of its entry-level BlackBerry 7 phones in India and
Latin America.

 

The company said that it is making steady progress with
the innovation of BlackBerry 10 mobile computing platform, which is still on
track to launch in the latter part of calendar 2012.

 

 RIM said the company looks to save $1 billion
through its CORE (cost optimization and resource efficiency) program, which
aims to deliver key operational savings through various initiatives.

 

Also, the company claims that its app world now feature
more than 80,000 app which represents a 220 percent increase from one year ago,
and more than 15,000 apps for PlayBook compared to less than 2,000 last year.

 

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