Research in Motion on Thursday announced the departure of several top executives, while promising that big changes are coming at the struggling company in the wake of another disappointing financial performance. Former co-CEO Jim Balsillie stepped down as board director.
The BlackBerry maker plans to abandon efforts to penetrate certain consumer markets while refocusing on the enterprise and public sector segments where RIM maintains “a leading position,” said newly minted president and chief executive Thorsten Heins during a conference call with analysts to discuss the company’s fourth-quarter and fiscal 2012 earnings.
RIM “was late to the ‘bring your own device’ movement,” Heins said, explaining candidly that the company was caught off-guard under previous leadership by the growing presence of consumer-oriented smartphones like Apple’s iPhone in managed IT environments once dominated by BlackBerry devices.
Heins, formerly RIM’s chief operating officer, took over as CEO in January after long-time co-CEOs Balsillie and Mike Lazaridis stepped down amidst a crisis of shareholder confidence with the beleaguered company’s leadership.
The company’s future rests on its upcoming BlackBerry 10 (BB10) software platform for future handsets and tablets, he said, pledging that the new operating system was on schedule for release later this year and would be the foundation of RIM’s business for years to come.
BlackBerry 10 is RIM’s upcoming, QNX-based smartphone OS, which was originally supposed to be available early this year but has been delayed to the fall. In January, RIM said that BB10 will share developer tools and a screen aspect ratio with the BlackBerry PlayBook tablet.
But if Heins promised a rosier future, he acknowledged that RIM’s present troubles required “substantial change.”
How bad is it? RIM posted a net loss of $125 million in its fiscal fourth quarter, with revenue of $4.2 billion slipping 19 percent from the third quarter and down 25 percent from the same period in the previous year. For the full year, RIM had sales of $18.4 billion, down 7 percent from the $19.9 billion in revenue it reported for its fiscal 2011.
RIM also said it shipped 11.1 million BlackBerry smartphones and more than 500,000 BlackBerry PlayBook tablets during the three-month period ending March 3. But that could be the last time we hear such figures for awhile—given what it portrayed as the uncertainty of its position in the mobile device market, the company said it has decided “to discontinue providing specific quantitative guidance” and unit shipment numbers in future earnings reports.
Heins said that aside from building towards the BB10 release, RIM would be narrowing its focus on its traditional enterprise customer base in the coming days.
“We believe that BlackBerry cannot succeed if we try to be everybody’s darling and all things to all people,” he said. Instead, RIM plans to improve and accelerate enterprise-focused offering like BlackBerry Mobile Fusion, a software platform that helps IT organizations integrate its BlackBerry smartphones and PlayBook tablets with iOS and Android devices across managed IT environments.
Refocusing on the enterprise is precisely what RIM needs to do and has been a long time coming, according to Patrick Moorhead, president and principal analyst of Moor Insights and Strategy.
“RIM’s disappointing earnings can be attributed to their movement away from their core markets and competencies,” Moorhead said. “As soon as RIM started to aggressively moving away from businesses and governments, the slide began … and then RIM stuck to their guns and failed to listen to the marketplace once the slide began. RIM needs to exit the consumer market and focus on large organizations and small businesses. Here, they have a chance.”
Balsillie’s departure marks the end of his 20 years of service to RIM.
“As I complete my retirement from RIM, I’m grateful for this remarkable experience and for the opportunity to have worked with outstanding professionals who helped turn a Canadian idea into a global success,” he said.
The company also parted ways with David Yach, its chief software technology officer, and Jim Rowan, chief operation officer for Global Operations.
