RIM Releases Earnings Report


Here’s the official press release for RIM’s preliminary second quarter results, enjoy!

Research In Motion Limited (RIM) (NASDAQ:RIMM)(TSX:RIM), a world leader in the mobile communications market, today reported preliminary second quarter results for the three months ended September 2, 2006 (all figures in U.S. dollars).

The results reported today are preliminary pending a potential restatement related to RIM’s historical non-cash charges associated with past option grants. As disclosed in a separate press release issued by RIM today, RIM is completing a management-initiated, voluntary review of RIM’s historical option granting practices. It is the Company’s belief that the potential impact of any restatement on GAAP and adjusted operating results for the first, second, and subsequent quarters of fiscal 2007, will be immaterial. RIM will file final financial statements for the second quarter of fiscal 2007 following the completion of the review.

Revenue for the second quarter of fiscal 2007 was $658.5 million, up 7.4% from $613.1 million in the previous quarter and up 34.4% from $490.1 million in the same quarter of last year. The revenue breakdown for the quarter was approximately 72% for handhelds, 19% for service, 6% for software, and 3% for other revenue. Approximately 705,000 BlackBerry subscriber accounts were added in the quarter. At the end of the quarter, the total BlackBerry subscriber account base was approximately 6.2 million. Revenue and subscriber account additions will not be impacted by any potential restatement referenced above.

“We are very pleased to report strong financial performance and momentum in our second quarter,” said Jim Balsillie, Chairman and Co-CEO at RIM. “The second half of the fiscal year is promising to be one of the most interesting periods in our history with the launch of exciting new products, including the BlackBerry Pearl, on networks around the world. Our technology and business strategies continue to open new markets for RIM and expand our opportunities for growth.”

Preliminary GAAP net income for the quarter was $140.8 million, or $0.74 per share diluted. Excluding regular stock option expense of $4.3 million, preliminary adjusted net income was $145.1 million, or $0.77 per share diluted. The preliminary net income, preliminary adjusted net income, preliminary net income per share and preliminary adjusted net income per share do not have any standardized meaning prescribed by GAAP and therefore are unlikely to be comparable to similar measures presented by other issuers. These adjusted measures should be considered in the context of RIM’s GAAP results.

Revenue for the third quarter of fiscal 2007 ending December 2, 2006 is expected to be in the range of $780-$820 million. Subscriber account additions in the third quarter are expected to be approximately 800,000. GAAP earnings per share for the third quarter are expected to be in the range of 88-95 cents per share diluted. Adjusted earnings per share for the third quarter, which excludes regular stock option expense of approximately $4.5 million, are forecast to be in the range of 90-97 cents per share diluted.

The total of cash, cash equivalents, short-term and long-term investments was $1.2 billion as at September 2, 2006, compared to $1.3 billion at the end of the previous quarter, a decrease of $100 million over the prior quarter. Uses of cash in the quarter included a business acquisition, capital expenditures and common share repurchases.

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