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RIM Posts Strong Quarterly Numbers

Posted on Wednesday 30 June 2004

Research in Motion said its FQ12005 revenue climbed 28% from the previous quarter to nearly US$270 and its net income rose 32% to $55M after taking a $16M provision for its patent litigation with NTP. The company said its BlackBerry subscriber base grew 25% during the quarter to 1.34M users.

But despite the striking growth in subscriber numbers revenue growth in services in struggling. RIM reported that 68% of its quarterly revenue came from the sale of handhelds, 19% from service, 9% from software licenses and 4% from “other revenue.” Last quarter the company said that 23% of its revenues came from services. So while revenue from hardware sales leapt 32%, revenue from its licensing programs grew 44% (likely driven by the lump sum payment from the settlement with Good) and even its “other revenue” category grew nearly 71%, the company’s services revenue grew from $48.4M to $51.3M, or just 6%.

In April I asked how RIM will fare as a hardware company against the larger players, especially those from the Far East. It’s a question that bears repeating.

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