[2004-10-04] Mobile move bears fruit for BlackBerry
HE maker of the BlackBerry email pager, Research in Motion, says second-quarter profit rose 33-fold and sales surged as more mobile phone service providers agreed to offer its products.
Net income in the quarter ending in August jumped to $US70.6 million ($97.8 million), or 36 US cents a share, from $US2.15 million, or 1c, a year earlier, the Ontario-based company says.
Sales rose to $US310.2 million from $US125.7 million.
Research in Motion added 317,000 subscribers in the quarter as mobile phone companies, seeking higher sales from services other than voice calls, signed up to carry its pagers.
The company is expanding beyond its North American base to Europe and Asia and released a new device, the BlackBerry 7100, which is shaped more like a phone and lets users send calls and email to other countries.
"Research In Motion's customers, telecoms carriers, require new, high-margin data services to offset declining prices on voice services," Brantley Thompson, a Goldman Sachs Group analyst in New York, writes in a September 20 note to clients.
He rates the shares "outperform".
Agreements with more than 20 wireless carriers will help Research in Motion target European and Asian markets, Thompson writes.
Nokia and Motorola are among phone makers that offer, or will begin to offer, devices with BlackBerry services.
BlackBerry's shares have more than doubled this year.
Excluding certain expenses, the company says, it earned US45c a share.
On that basis, Research in Motion is expected to report profit of US43c a share – the average of 22 estimates.
It is expected to report sales of $US309.7 million, the average of 19 estimates, according to Thomson Financial.
The company says it expects third-quarter profit, excluding certain costs or gains, of US50c to US55c a share on sales of $US340 million to $US360 million.
Analysts are expecting profit of US50c a share, the average of 22 estimates, and sales of $US357.5 million, the average of 17 estimates, according to a Thomson Financial survey.
In the year earlier period, the company had net income of $US16.3 million, or US10c a share, and sales of $US153.9 million.
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