RIM: Subscriber Numbers Up After Lawsuit

The number of new subscribers Research In Motion (RIM) added in the three months ending June 3 shows that customers are signing up for the mobile push e-mail service after a slowdown related to a high-profile intellectual property rights (IPR) lawsuit, RIM said on Thursday.

“There’s no question there’s a resurgence setting up after the IPR overhang and hype going on in the market in the last six to nine months,” Jim Balsillie, chairman and co-chief executive officer for RIM, said during a conference call to discuss the company’s financial results for the quarter ending June 3, the first quarter of its fiscal year. Earlier this year, RIM settled a contentious patent lawsuit that had dragged down sales for the BlackBerry maker.

During its first fiscal quarter, RIM added 680,000 subscribers and shipped 1.2 million devices. RIM now has 5.5 million subscribers worldwide.

While revenues were higher than RIM expected, net income slipped. RIM reported US$129.8 million in net income for the quarter, compared to $132.5 million during the same quarter last year. The dip was due in part to an increase in operating expenses as RIM invests in new product development and international market expansion, RIM said. For the quarter, 26 percent of customers were outside of North America, up from the previous year, said Dennis Kavelman, RIM’s chief financial officer.

Revenue was $613.1 million in the first quarter, up 35.1 percent from $453.9 million in the same quarter in the previous year.

In its next fiscal quarter, RIM expects to add 675,000 to 700,000 new customers and increase revenue. Despite growing competition from an increasing number of providers of push e-mail services, including Microsoft, RIM said it hasn’t yet felt an impact from the new players. “We’re not seeing anyone taking any kind of share of what we have,” Balsillie said.

In March, RIM agreed to pay $612.5 million to settle a lawsuit with NTP, which claimed that RIM infringed on some of its patents. NTP had asked the court to require RIM to shut down its service in the United States, a threat that RIM said explained a slowdown in new customer additions late last year. RIM is currently defending itself in a new patent dispute, this time from Visto.

-Nancy Gohring, IDG News Service (Dublin Bureau)

Related Link:

• RIM CEO: Patent Reform Still Needed

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