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BlackBerry parent Research in Motion loses subscribers for first time

December 20, 2012|By Andrea Chang

For the first time, struggling BlackBerry maker Research in Motion saw a decline in its subscriber base, reporting that the number of customers declined to 79 million in its fiscal third quarter.  

Three months ago, the Canadian company had 80 million subscribers.

Revenue for the third quarter was $2.7 billion, down 47% from $5.2 billion in the same quarter a year earlier. The company posted a loss of $9 million, or 2 cents a share, compared with a profit of $265 million, or 51 cents a share, a year earlier. 

Excluding one-time items, the company reported a loss of $114 million, or 22 cents a share. That was better than the 35-cent-a-share loss that analysts polled by Thomson Reuters had predicted. 

During the quarter, the company shipped about 6.9 million BlackBerry smartphones and about 255,000 PlayBook tablets.

The company reported earnings after the markets closed. Shares rose 6.7% to $15.07 in after-hours trading after rising 49 cents, or 3.6%, to $14.12 during the day. 

RIM is just a month away from debuting its long-delayed BlackBerry 10 operating system in what analysts and other tech watchers are calling a last-ditch effort for the troubled tech company to get back on track. It has lost significant market share in the U.S and other crucial regions to Apple's iPhone and smartphones running Google's Android platform. 

For the current quarter, RIM said it expected "continued pressure" on operating results and said it was considering using pricing initiatives on BlackBerry 7 devices and service fees as a way to maintain subscribers. The company also said it would spend significantly more on marketing costs this quarter to promote the global launch of BlackBerry 10 and expected to report an operating loss. 

The company also warned that BlackBerry 7 products could see a decline in sales as consumers defer purchases until BlackBerry 10 devices are available. That would "impact unit volumes, subscribers, margins and service fees," RIM said.

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