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RIM takes hit


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June 29, 2005

RIM takes hit

Steve Rosenbush

Late this afternoon, Research in Motion warned that results for the current quarter won't be up to expectations. The maker of the Blackberry e-mail device beat expectations for last quarter, thanks in part to a tax credit, according to a report at The Street.com.Investors were not happy, and shares were down 6%, according to the report.

Now, this disappointment ought to be put in context. Revenues were up nearly 70% last quarter, reflecting the phenomenal growth of the wireless email market. But the sector is getting more competitive by the moment, it seems. Everyone from Microsoft to Seven, Intellisync, Visto and Good Technologies is offering a version of its own. And wireless email is now available to consumers through wireless carriers like Sprint PCS and Nextel. So it remains unclear whether the case for a stand-alone business based on wireless e-mail makes sense, or whether Blackberry should be part of a larger company, its phenomenal success notwithstanding. There have been relentless rumors that the company will be sold to a larger rival, although most potential buyers have challenges of their own, and that makes a deal hard to do. The alternative is that RIM expands its own business. Either way, it wouldn't be surprising to see this company take an active role in the M&A market.

05:43 PM

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