RIM misses profit targets as PlayBook sales slump

By Posted 2 Dec 2011, 18:07

RIM has faced one of its toughest years so far when it comes to their range of BlackBerry devices. Their smartphones became out of favor with Android and Apple smartphones becoming more popular, they then suffered a major outage which left some concerned users who started to question the company’s reliability. They now are facing trouble when it comes to their BlackBerry tablet, the PlayBook as sales have been slower than expected which means they will miss profit targets.

While the main reason for the missed targets is largely down to the slow PlayBook sales, ultimately the cause for the lack of profit will come from the $485 million charge that the company is to incur to cover the write-down of the tablets’ inventory value according to the Financial Times. A charge of $50 million was also taken by them that covered the outage. The company’s shares value decreased to $16.85, a 9% drop in New York trading.

Due to the lackluster reception of the BlackBerry PlayBook rumors have begun to circulate suggesting RIM is to abandon the tablet. This forced the company’s senior management to produce a statement suggesting that this was not the case despite the mixed reviews. Co-chief Executive Mike Lazaridis said ‘RIM is committed to the BlackBerry PlayBook and believes the tablet market is still in its infancy.’

RIM also noted that they had sold 14.1 million smartphones and about 150,000 PlayBook tablets in the third quarter which ended last month. While they have been enjoying continued growth outside of North America, they also face deserters including consumers and employees joining rivals Apple and Android. Do you think RIM is in trouble? What do you think of their products?