Original Source: FD (FAIR DISCLOSURE) WIRE
. Adele Ebbs, Research In Motion Limited, VP of IR . James Balsillie, Research In Motion Limited, co-CEO . Brian Bidulka, Research In Motion Limited, CAO . Michael Ounjian, Credit Suisse, Analyst . Maynard Um, UBS, Analyst . Mike Abramsky, RBC Capital Markets, Analyst . Paul Coster, JPMorgan Chase & Co., Analyst . Chris Umiastowski, TD Newcrest, Analyst . James Faucette, Pacific Crest Securities, Analyst . Vivek Arya, Merrill Lynch, Analyst . Deepak Chopra, National Bank Financial, Analyst . Gus Papageorgiou, Scotia Capital, Analyst
RIMM reported 3Q08 revenues of $1.67b. 3Q08 net income was $370m or $0.65 per diluted share. Co. expects 4Q08 revenues to be $1.8-1.87b and expects 4Q08 EPS to be $0.66-0.70 per share.
A. Key Data From Call 1. 3Q08 revenue = $1.67b. 2. 3Q08 net income = $370m. 3. 3Q08 diluted EPS = $0.65. 4. 3Q08 GM = approx. 51%.
5. 3Q08 CapEx = approx. $97m. 6. 3Q08 DSO = 52 days. 7. 3Q08 Inventory on-hand = approx. $340m. 8. Cash, cash equivalents and investments at 3Q08-end = approx. $2.1b. 9. Expected 4Q08 revenue = $1.8-1.87b. 10. Expected 4Q08 EPS = $0.66-0.70.
S1. 3Q08 Business Review (J.B.) 1. Highlights: 1. Co. reported a solid 3Q08 with revenue growing 100% over 3Q07 and earnings more than doubling year-over-year. 2. Demand for BlackBerry products and services in 3Q08 were strong with approx. 1.65m BlackBerry net subscriber accounts addition, inline with Sept. forecast.
1. This was 14% higher than the approx. 1.45m subscriber accounts added in 2Q08. 3. New products such as the BlackBerry Pearl, 8130 for CDMA and heavy promotion by carrier partners heading into the holiday season dove strength especially in the latter part of the qtr. 4. Co. saw its recent efforts in channel expansion retail programs and carrier support to bear fruit with black Friday being the strong day ever in terms of net subscriber account addition. 5. At 3Q08-end, approx. 34% of the subscriber base was non-enterprise. 2. North America: 1. Saw continued commitment and support for the BlackBerry solutions from partners.
2. BlackBerry products were included in numerous AT&T back-to-school promotions in Sept. 3. Saw a strength at T-Mobile with their launch of a Wi-Fi enabled 8320 combined with their HotSpot @Home offering and the 999 BIS email pricing plan. 4. CDMA partners had an excellent qtr. with: 1. Continued success with the 8830 World phone. 2. Launch of the next generation BlackBerry Pearl 8310 for CDMA. 5. In conjunction with the launch of the BlackBerry Pearl, Verizon Wireless introduced a 2999 monthly BlackBerry service plan. 1. This plan, which offers customer's unlimited access to BIS email, and unlimited browser use [fetching] exponent result since launch. 6. At Sprint, there was continued success with the BlackBerry 8830 World Edition across all channels driven by ongoing promotion and support. 1. In late Nov., Sprint launched the BlackBerry Pearl 8130 and supported the launch with over 1500 in-store training events and channel facing launch events in cities across the country. 2. Sprint also introduced a new pricing plan which includes unlimited BIS email, unlimited browsing, unlimited instant messaging, and other attractive features for only $30 a month. 7. In Canada, the CDMA carriers also stepped up their marketing efforts for both the 8830 World Phone and Pearl.
1. Talus has focused on data and made BlackBerry Pearl on of
their holiday hero products for 2007, with Peal being featured in most of their TV adds, radio print, online and outdoor advertising for the holiday season. 2. They add further support to these efforts by offering a $15 a month BlackBerry bills pricing plan.
8. At Bell the CDMA Pearl was launched into all channel and for
the first time ever BlackBerry smart phones were featured in
Bells consumer add campaign along with their other top
consumer devices. 1. This launch combined with a continued strong momentum of the 8830 had Bell to reach their highest level of BlackBerry service activations ever. 2. Bell supplemented these program also by offering $15 unlimited email and instant messaging plan. 1. These efforts have resulted in extremely strong market
share performance by these carriers in the qtr. 9. Channel development continues to be primary area of focus for RIMM with all four major US carriers launching BlackBerry smart phones in 3Q08.
10. Partner advertising for the Thanksgiving holiday exceeded the
expectations in both online and print adds reaching millions
of household heading into the busy retail season. 1. Sam's Club is committed to making the BlackBerry Pearl a holiday featured product and so far has seen a 400% increase in weekly BlackBerry sell-through. 3. Europe: 1. Over 33% of the subscriber base is now outside of North America. 2. In Europe, Carphone Warehouse continues to build on the success of their launch of BlackBerry products is now expanding their offering to include: 1. The Pearl 8120 in a sunset red finish. 2. The Curve 8310 with their proprietary navigator service supported by (indiscernible) being preloaded. 3. Heading into New Year, Co. expects to see even more contributions from this channel. 3. Throughout Europe, Co. is seeing strong adoption and brand recognition of its product particularly in central and southern regions. 4. Carrier partner contributions have been significant with Mobilkom in Austria placing adds for the Curve 8310 with GPS navigation on city buses, bus stops, and street lights. 5. Vodafone coupled numerous device launches with aggressive advertising campaigns online at airports and in print and TV media. 6. In Spain, Co. saw Telefonica launch a new lower BIS pricing plan, which they have supported with an aggressive adverting program.
1. Vodofane Spain launched the 8310 with a hero advertising campaign in Airports and through print and outdoors adds. 4. Emerging Markets:
1. RIMM success in emerging markets continued in 3Q08 with
BlackBerry Curve 8310 with GPS was announced in Latin America
at FutureCom Brazil held in Oct. 2. Major advertising campaigns ran in Brazil featuring the 8310 by CLARO and TIM. 1. CLARO use the VIP customer program CLARO A to announce the 8310 to their top accounts in Brazil and put 8310 displays in the retail stores with very aggressive pricing. 2. TIM Brazil also announced a new pay-as-you-go BlackBerry service plan with their advertising campaign. 3. A number of other carriers thought the region launched the …