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Research in Motion Lowers Forecast for Subscribers

November 24, 2005|From Associated Press

Research in Motion Ltd., maker of the BlackBerry wireless device, lowered projections Wednesday for new subscribers because of product launch delays, though it backed its revenue forecast for the third quarter.

Shares of the company fell 80 cents to $66.28.

The new projections come as RIM awaits final resolution of a high-stakes battle in a Virginia court where a jury has found BlackBerry's maker guilty of patent infringement.

The federal judge there is due to rule as early as next week on RIM's request to enforce a preliminary $450-million settlement that has unraveled with patent holding company NTP Inc. or -- if the sides can't negotiate a new deal -- possibly implement an injunction that would halt BlackBerry service in the United States.

RIM, which is based in Waterloo, Canada, said its subscriber additions for the fourth quarter would be about 3% lower than the initial forecast of 775,000 to 825,000. For the third quarter ending Saturday, the company sees subscriber additions about 8% lower than the previously forecast range of 680,000 to 710,000.

But RIM reaffirmed its third-quarter revenue projection of $540 million to $570 million and said it did not expect "any material impact" to its prior fourth-quarter revenue guidance.

In late September, the company predicted a fourth-quarter profit of 74 cents to 81 cents a share on revenue of $590 million to $620 million.

Wall Street analysts expect the company to post sales of $556 million in the third quarter and a profit of 76 cents a share on revenue of $606 million in the fourth quarter.

RIM's prior projection, given in September, was based on the expected availability in early November of two next-generation BlackBerry handsets, the 8700 and 7130 series.

But those products have suffered launch delays, and national retail availability isn't expected until early December.

RIM will report its third-quarter financial results Dec. 21.

In the last 12 months, RIM's shares have traded in a band of $51.90 to $103.56 and have shed 19% since the start of the year.

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