RIM to cut jobs as it looks to return to profitability
30th May 2012 | 08:52
No profit expected in the short term
Research in Motion is sounding the alarms as it confirms job cuts and a loss for the next few months.
RIM CEO Thorsten Heins has signalled that the company has a turbulent year ahead of it, and things look like they are going to get worse before they get better.
Heins said: "our financial performance will continue to be challenging for the next few quarters.
"The on-going competitive environment is impacting our business in the form of lower volumes and highly competitive pricing dynamics in the marketplace, and we expect our Q1 results to reflect this, and likely result in an operating loss for the quarter."
Calling in the cavalry
RIM has called in JPMorgan and RBC Capital Markets as the company starts a strategic review, which will involve significant job cuts – although the firm will still hire personnel in key areas.
"While there will be significant spending reductions and headcount reductions in some areas throughout the remainder of the fiscal year, we will continue to spend and hire in key areas such as those associated with the launch of BlackBerry 10, and those tied to the growth of our application developer community."
It's not all bad news though, with Heins revealing that RIM expects to increase its cash position and he points out the success of BlackBerry World 2012, the App World hitting 80,000 apps and positive development of the new BlackBerry 10 operating system.
RIM is in a tricky position and laying off staff is not going to win the company and fans, but Heins is confident that the firm will return to the top - although that rests heavily on the success of BB10.