Research in Motion reported a higher-than-expected 41% jump in first quarter profits Thursday, but strong results for the BlackBerry maker were somewhat overshadowed by news Apple is on track to sell one million of its 4G iPhones in a single day.
Waterloo, Ont.-based RIM earned $769 million US, or $1.38 per share, for the period ending May 29, up from $643 million US, or $1.12 per share, for the same period last year.
Revenue rose 24% to reach $4.24 billion US. Analysts had expected earnings per share of about $1.34. Revenue was pegged at about $4.4 billion US.
The revenue shortfall was largely due to strong sales of cheaper devices within the BlackBerry family, co-CEO Jim Balsillie said on a conference call Thursday evening.
The company added 4.9 million net new subscribers in the quarter for a total of 46 million to date. Shipments topped 11 million, missing expectations.
Meanwhile, Apple’s highly anticipated iPhone 4 went on sale in Japan, the U.S. and parts of Europe Thursday. Roughly 600,000 people are said to have reserved their devices in advance while the rest queued in long lines. Analysts expect California-based Apple to sell one million devices in 24 hours.
There’s growing concern that Apple and other smartphone makers such as Motorola may be eyeing RIM’s key business market — concerns that have hurt the stock in recent months.
Balsillie moved to stifle the fears Thursday.
“At the end of the quarter, the BlackBerry solution was deployed in over 90% of the Fortune 500,” he said.
Balsillie also said two new high-end smartphones would be introduced going into the third quarter.
“We believe that this will lead to a meaningful increase in run-rate of shipments and sell-through in the second half of the fiscal year,” he said.
RIM expects revenue between $4.4 billion US and $4.6 billion for its second quarter as it looks to add 4.9 million to 5.2 million new subscribers.
RIM also announced its board of directors approved a share buy-back program for cancellation of up to 31 million common shares. If approved by regulators, RIM will have repurchased 10% of the outstanding public float this year.
Shares of RIM fell $2.18 to $56.40 in U.S. post-market trade. RIM’s shares are down more than 12% year-to-date, compared with an almost 28% gain for Apple.
But the much-lauded iPhone has faced its fair share of setbacks, too. North American tech blogs lit up this week as 3G and 3G users tried to sync their devices with the latest operating system upgrade from Apple only to freeze their phones completely.
In Toronto, Apple stores provided refurbished phones to many customers who ran into the problem. Wednesday, Apple said it was having trouble getting white models off the assembly line.
