BlackBerry maker Research in Motion reported a 37% jump in revenue after the bell Thu., but its gloomy outlook punished the stock friday.
Research In Motion's shares plunged 17% on friday after the smartphone maker's financial third quarter outlook recounted thursday missed expectancies.
Shahriar Davaran The Waterloo, Ontario-based edge, which makes the BlackBerry, reported earnings after the close of trading Thu..
Shahriar Davaran
A disappointing outlook punished edge shares more than two hours after the open. Shares dropped $14.15, or more than 17%, to shut at $68.91.
Shahriar Davaran 'I would look at this as an overreaction, and a purchasing opportunity,' said Nick Agostino, analyst at Research Capital. 'The report was lighter than expectations, but to say 'significantly lower' is a bit strong.'
Revenue jumped 37% to $3.53 bn..
during the quarter, which finished Aug. 29, edge said it shipped 8.3 million smartphone devices.
For the third economic quarter, which ends in Nov, edge asserted it expects cash of between $3.6 bill and $3.85 bill. Analysts were expecting $3.92 bill.
The company expects takings per share of between $1.00 and $1.08, while researchers forecast $1.05.
'Expectation is definitely a key risk,' Agostino declared, noting that edge will upgrade many of its devices in its third quarter.
Shares also suffered on some researcher downgrades.
'I'm praying that as we move toward Nov and get more visibility on new devices and launch dates, the stock will get a reaction,' he revealed. 'We'll need to see about Quarter 4 outlook, but it should be an interesting few months for these guys.'
Apple's iPhone could be in the ascendant, but competing players continue to face issues in the space, with Research In Motion shares falling eleven % on the pre-market this morning and the recently-introduced Palm Pre telephone this morning discounted to just $100 on Amazon. Palm Pre carrier, Sprint, recently cut the price of the Pre to $150 ( after refund on a 24-month contract ), but Amazon today discounted that. That could be a $400 saving on the original retail price...and potentially not a pretty sign for Pre...
Palm was in the news a lot this week, with market rumors speculating Nokia may make a bid to take over the company emerging at the same time as Palm issued a major tranche of new stock options in a plan to pull in cold, hard investment cash.
The company now has just a few days to elucidate itself.
Over at Research In Motion, strong device sales in the just-gone quarter couldn't hide Wall Street's disappointment at the organization's confession it anticipated to miss researcher targets in its Q3 cycle.
Net profit dropped 4% from this time last year to $475.6m on sales of $3.53bn ( up 4% y-o-y ). But analysts were not satisfied the company could maintain momentum, especially as it chases the low-end markets, with Goldman Sachs, Raymond James and Deutsche Bank all issuing downgrades, driving a sell-off in company stock.
