Device operating systems

RIM Delays BlackBerry 10 Phones 'Til 2013

The hits keep coming for BlackBerry : The Canadian smartphone maker says its flagship operating system will be delayed until the first quarter of 2013.

The news was part of a grim earnings announcement Wednesday, which confirmed up to 5,000 job cuts and a first-quarter loss of $518 million, for the fiscal quarter that ended June 2. (See RIM Posts $518M Q1 Loss.)

The company had pinned some of its hopes for a recovery on BlackBerry 10, which was expected to arrive in October but will now miss the lucrative holiday season. (See BlackBerry 10: For the Data & Time Crunched.) The company also confirmed that further job cuts are coming. "Restructuring efforts underway that will include a workforce reduction of approximately 5,000 employees as part of RIM's efforts to realize over $1 billion in cost savings," the company said. (See More Job Cuts at RIM.) The company posted a GAAP net loss for the quarter of $518 million, or $0.99 per diluted share, compared with GAAP net income of $695 million, or $1.33 per share diluted, in the same quarter last year. First-quarter revenues were $2.8 billion, down 43 percent from $4.9 billion in the same quarter of fiscal 2012.

A non-GAAP loss of $0.37 per share was way, way off the analyst consensus of a $0.04-per-share loss, according to Thomson Reuters . During the quarter, RIM shipped 7.8 million BlackBerry smartphones and about 260,000 BlackBerry PlayBook tablets.

RIM shares were down $1.52 (17 percent) at $7.61 in after-hours trading.

Slimming down
RIM's new CEO, Thorsten Heins, said on the company's earnings call that the BB10 phones are delayed because of the challenges of building lots more code into the OS.

"Would we have loved to be a bit earlier, for sure," the CEO said on the call. But "quality and a great user experience" are paramount, the CEO stressed, saying he wouldn't ship a product that didn't meet the company's standards.

The company expects to offer a slimmed-down portfolio as it moves to reboot the BlackBerry brand with BB10. Multi-touch and QWERTY phones are expected to arrive at around the same time.

Meanwhile, RIM is looking at more cost-cutting and strategic measures to ensure its future. The company confirmed that it will see an operating loss in its second quarter, which ends in August. The job cuts will happen swiftly during the next few quarters, the CEO added.

The company is also continuing to look at its strategic and licensing options in the future. Heins didn't reveal specifics but made it clear that no options are off the table.

Questioned by analysts on whether the company was trying to reinvent the wheel when it could license Android for an OS instead, Heins said it would be "confusing" for customers if RIM used Android. RIM had to take the "hard road" and build BB10, he said.

— Dan Jones, Site Editor, Light Reading Mobile

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