RIM Q2 Earnings Beat Expectations

Blackberry Torch 9800

Strong demand for its BlackBerry portfolio of smartphones propelled Research In Motion to second quarter earnings that exceeded Wall Street's expectations, the company said Thursday. Sales were $4.62 billion for the quarter, up 9% from the first quarter of the year, RIM said in a statement, and up 31% from the same quarter in 2009.

Earnings per share increased 76% to $1.46 over the second quarter in 2009, Waterloo, Ontario-based RIM said. Shipments of BlackBerry devices grew over 45% to 12.1 million over the same quarter last year. To date, RIM has shipped 115 million BlackBerry smartphones, which the company said set a new record for the quarter.

During the second quarter, RIM added approximately 4.5 million new BlackBerry subscriber accounts for a total customer base of over 50 million, the company said, although the growth was below analysts' expectations.

"This accomplishment and RIM's solid financial results during the second quarter were driven by effective business execution and strong demand for RIM's portfolio of BlackBerry smartphones and services in markets around the world," said Jim Balsillie, Co-CEO at Research In Motion, in a statement. "We expect a continuation of this momentum in the third quarter as we extend the rollout of new products including the BlackBerry Torch into additional markets and benefit from heavy promotional activities and increasing customer demand as we head into the holiday buying season."

In spite of the upbeat news, RIM continues to face steep competition from Apple Inc.'s iPhone and other smartphones running Google's Android operating system. But analysts said that BlackBerry still resonates with corporate enterprises. Last month, RIM's first device with a slide out keyboard, the BlackBerry Torch, went on sale exclusively at AT&T and has received mixed reviews. Sales of the device have been decent, analysts said, with greater potential overseas. Balsillie, meanwhile, called the Torch the most successful launch in RIM's history, but declined to give sales figures. At next week's BlackBerry Devcon Conference in San Francisco, he hinted that attendees may see new products and technology enhancements.

In the current quarter ending on Nov. 27, RIM said it expects to increase shipments to between 13.8 million and 14.4 million devices; add between 5 million and 5.4 million subscriber accounts; and see revenues of between $5.3 billion and $5.55 billion.