RIM sees 3Q profits rise 45% on Torch strength

By Reuters
Posted Dec. 16, 2010 at 4:26 p.m.

Research In Motion reported results that mostly beat expectations Thursday, and the BlackBerry maker forecast strong profits for the current quarter, pushing its shares higher in after-hours trade.

RIM said net profit jumped 45 percent in its third quarter, which ended Nov. 27. It said results were boosted by strong sales of its flagship Torch smartphone, a new product that combines a touch screen like Apple’s iPhone with RIM’s trademark mini keyboard.

“The results look pretty good. For the current quarter they definitely benefited from some new products … The guidance also looks quite strong,” said Shaw Wu, of Kaufman Bros. in San Francisco.

“The guidance is strong, but I think there is some concern that it could be too optimistic perhaps because of the ongoing pressure, particularly from Android, in international markets.”

The Canadian company said it expects to earn $1.74 to $1.80 per share in the current quarter, sharply more than analysts had been expecting.

Also beating analyst average expectations was the news that RIM shipped 14.2 million BlackBerry smartphones in the quarter. It added a net 5.1 million new subscribers, in a performance that matched the average forecast for this key metric.

RIM’s net profit of $911.1 million, or $1.74 per share, on revenue of $5.49 billion, handily beat forecasts. Analysts had expected earnings of $1.65 per share and revenue of $5.4 billion, according to Thomson Reuters I/B/E/S.

RIM shares were up 2.5 percent, at $60.75, in post-market trade.

“I think you’re seeing the stock kind of yo-yo a bit. It actually sold off, and now it’s up again,” said Wu.

RIM competes with Apple and other manufacturers in the growing smart phone market.

Analysts have worried that it could lose core business customers to Apple and Google, whose Android software is used by device makers including Motorola , Taiwan’s HTC Corp. and South Korea’s Samsung.

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