Research In Motion lost money on its BlackBerry smartphones and tablets in 2011, one analyst suggests. Peter Misek of investment banking firm Jefferies calculated that, after assigning operating costs and including inventory charges, the embattled RIM spent 4% more than it took in.
In an annual filing RIM posted online, gross margins on hardware items fell from 36% to just 20% in one year. But with the beleaguered Waterloo-based company no longer guiding investors with financial forecasts, it’s difficult to confirm Peter’s math.
What is known is that RIM has been selling its PlayBook for up to 60% off, a discount that we are aware isn’t profitable: the company lost nearly $500 million in a single quarter pushing this loss-leader promotion last year.
When Peter spoke over the phone with Thomson Reuters, he stated that “it’s not likely to get better anytime soon,” suggesting that RIM will “have to keep cutting prices” in order to remain competitive for the foreseeable future. RIM’s most recent quarterly earnings report revealed its first qaurterly loss in seven years.
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