RIMM Q3 Article:
Friday September 29 6:42 PM ET
RIM Shares Top Nasdaq Gainers on Strong Q3 Revenues
dailynews.yahoo.com
TORONTO (Reuters) - Shares in Research In Motion (NasdaqNM:RIMM - news) sprinted out of the gate on Friday morning after the maker of the popular Blackberry two-way wireless pager demonstrated its costly marketing programs are reaping rewards.
RIM said after the markets closed on Thursday that its revenues in the second quarter rose 57 percent from the first quarter to $42.5 million. Analysts' estimates had ranged between $33 million and $36 million.
RIM said 25,000 new Blackberry pager customers were connected to corporate-based servers in the quarter and that companies deploying the pagers rose 25 percent to 5,000.
Blackberry is an ``always on, always connected'' two-way wireless pager, with a small keyboard for sending e-mails and surfing the Internet, plus address book and calendar.
Also, the firm said on Thursday that America Online is scheduled to launch its version of the Blackberry, targeted at the teenage market, later this year. That will mark RIM's first big push into the consumer market.
Investors applauded the results on Friday, pushing RIM's stock up $15-1/8 to close at $98-9/16 on Nasdaq and topping the net gainers.
Edel Ebbs at UBS Warburg said she had raised her stock target price to $100 from an earlier $77 as visibility regarding future revenue growth improved, and growth in the quarter topped her forecasts.
``They are demonstrating that what they thought the market required, which was this additional sales and marketing to really build mass, is paying off in topline growth,'' she added.
RIM's push into the European marketplace with BT CellNet is also seen as a big boost to revenues, with RIM's management saying that ``material volumes'' in Europe will ramp up in the first quarter of 2001.
The company is developing an additional 180,000 square feet of manufacturing space that will meet the demand for the expected ``hundreds of thousands of new Blackberry users through next year,'' said RIM chief executive Jim Balsillie in a conference call with analysts.
H.C. Wainwright & Co. analyst Scott Wright issued a morning note on RIM, raising his target price to $115 with a strong buy.
``Research In Motion reported a breakthrough quarter, crossing out of cult status to mainstream brand awareness and acceptance,'' Wright wrote. |
