RIM Falls Sharply - iPhone killing BlackBerry

Research In Motion Falls as Forecast Misses Estimates (Update2)

By Vivek Shankar

Sept. 26 (Bloomberg) -- Research In Motion Ltd., maker of the
BlackBerry e-mail phone, fell as much as 22 percent in early trading
after competition from Apple Inc.'s new iPhone curbed its profit
forecast for the second quarter in a row.

``The gross margin [at RIM] is a nightmare,'' Peter Misek, an analyst
with Canaccord Adams Inc. in Toronto, said in an interview with
Bloomberg Radio. ``We certainly didn't expect that.

Complete breaking news at Bloomberg

http://www.bloomberg.com/apps/news?p...c&refer=canada

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Friday, September 26, 2008

RIMM Blood on iPhone's Touchscreen
http://bnvested.blogspot.com/2008/09...uchscreen.html

Research in Motion (RIMM) announced stunning earnings yesterday.

the Waterloo, Ontario-based company said it earned $495.5 million, or
86 cents per share, in the fiscal second quarter, which ended Aug. 30.
That was a 72 percent rise from net income of $287.7 million, 50 cents
per share, in the same quarter last year

RIMM is down to 73.75 -24.38% this morning as a result of their
margin forcast going forward.
[RIMM] warned on Thursday that profit in the current quarter would
come in lower than analysts had expected because of higher costs
related to its newest BlackBerry smartphones
RIM did not share but we know why they are willing to spend so much to
grow. iPhone.

If there is one thing that has settled in my mind over the last few
days is that (for right now) the iPhone is literally in its own market
space. We can talk about iPhone Vs. Blackberry or iPhone vs Android
(GooMo love it) or iPhone vs WinMo (sad) but the reality is that every
phone that claims to do more than just make calls is compared to the
iPhone. There are phones that do things better (email Blackberry) and
there are phones with features the iPhone does not yet have but the
entire handset industry is running to keep up with just one player.
iPhone.

The quarter ends in a couple of weeks and Apple will report similar
stunning earnings with outstanding unit growth in all segments.

iPhone 3Gold wrote:
> Apple has ordered a cut of in future production of about 4,000,000
> iPhones as sales weaken in a turbulent economy.
>
> Apple falls in sympathy with weak RIM forecast
> Fri Sep 26, 2008 11:50am EDT
>
> BOSTON (Reuters) - Apple Inc (AAPL.O: Quote, Profile, Research, Stock
> Buzz) shares fell as much as 5 percent on Friday on concern about the
> implications for the iPhone maker from a weak outlook by rival
> Research in Motion Ltd (RIM.TO: Quote, Profile, Research, Stock Buzz),
> which produces the BlackBerry smart phone.
>
> Research in Motion, or RIM, said late on Thursday that it expects
> profit to lag estimates this quarter, citing higher-than-expected
> costs on production of new devices. That sent RIM shares down 25
> percent on Friday and Apple shares fell in sympathy, analysts said.
>
> While Apple, whose iPhone is priced starting at $199 in the United
> States, does not necessarily face similar pressure on its margins,
> investors extrapolated that the market for sophisticated phones may be
> in trouble, analysts said.
>
> "People are concerned about the smart phone market," said Cross
> Research analyst Shannon Cross.
>
> Needham & Co. analyst Charles Wolf said that investors view Apple as a
> "high flyer like RIM" and that the expectations are too exuberant.
>
> "It's a combination of the psychology of RIM ... and also concerns
> about the how macro economy could effect Apple in the fourth quarter,"
> he said.
>
> Apple shares fell $5.12, or 4 percent, to $126.81 in heavy morning
> trade on Nasdaq.
>
So which is it? You seem to have posted three conflicting variations of this
story. Did Blackberry's stock drop because of iPhone competition or because
of the increased costs of producing more sophisticated phones? If BB's stock
dropped due to iPhone competition, one would expect Apple stock to rise, yet
you report that it, too, has fallen, "in sympathy" with BB's because of an
expectation that its margins may decrease as well.

Hey, you can't have it all ways, can you?