RIM Undertakes Purge of Senior Executives as Q4 Earnings Disappoint

Canada’s tech darling, Research in Motion (RIM) has started to fire off its senior level staff, according to a source close to the matter, reports the Globe and Mail:

“Lots of high level people within RIM were let go today,” this person said. “Quite a few. Big shake up.”

An example would be co-CEO Jim Balsillie, as RIM has announced he has left the company’s board of directors, as noted in RIM’s fourth quarter earnings press release. Balsillie and co-CEO Mike Lazaradis stepped down as CEOs back in late January. David Yach, RIM’s CTO has also ‘retired’ from the company and Jim Rowan, RIM’s COO has decided to pursue other interests.

“As I complete my retirement from RIM, I’m grateful for this remarkable experience and for the opportunity to have worked with outstanding professionals who helped turn a Canadian idea into a global success,” said Jim Balsillie.

New CEO, Thorsten Heins, had this to say about RIM’s future:

“…we are undertaking a comprehensive review of strategic opportunities including partnerships and joint ventures, licensing, and other ways to leverage RIM’s assets and maximize value for our stakeholders…it is very clear to me that substantial change is what RIM needs…we believe BlackBerry cannot succeed if we try to be everybody’s darling and all things to all people.”

Here are RIM’s Q4 numbers:

  • $4.2-billion in revenue, 19 per cent lower than the third quarter and well below its guidance of at least $4.6-billion.
  • RIM lost $125-million or 24 cents a share, diluted, in its fourth quarter, compared to a profit of $934-million or $1.78 a year earlier.
  • BlackBerry sales were down 21 per cent from last quarter.

It’s sad news, but we all saw this was coming. RIM failed to innovate and believed in their minds the BlackBerry would be able to weather the storm from the iPhone and Android. This was a critical lapse in judgement from their senior leadership, and the market has spoken.

Steve Jobs foresaw RIM’s fate during Apple’s 2010 Q4 earnings call:

First, let me discuss iPhone. We sold 14.1 million iPhones in the quarter, which represents a 91 percent unit growth over the year-ago quarter, and was well ahead of IDC’s latest published estimate of 64 percent growth for the global smartphone market in the September quarter. And it handily beats RIM’s 12.1 million BlackBerrys sold, in their most recent quarter ending in August. We’ve now passed RIM. And I don’t see them catching up to us in the foreseeable future.

They must look beyond their area of strength and comfort, into the unfamiliar territory of trying to become a software platform company. I think it’s going to be a challenge for them, to create a competitive platform, and to convince developers to create apps for yet a third software platform after iOS and Android. With 300,000 apps on Apple’s App Store, RIM has a high mountain ahead of them to climb.

Jobs nailed it back then, but RIM of course didn’t believe it. Here’s hoping the next line of BlackBerrys can help the company recover.

Founder and Editor-in-Chief of iPhoneinCanada.ca. Follow me on Twitter, and @iPhoneinCanada, and on Google+.

  • FragilityG4

    There’s a positive in all this … Their new CEO has finally admitted that change is needed … I was worried when he first took the helm and said “I don’t think we need to make many changes.”

    Nevertheless I hope they can somewhat recover but it seems quite unlikely at this point.

  • nosnoop

     I simply cannot understand the obsession with RIM’s bad news here.

    Why are we even seeing this piece of news in this web site at all?

  • So they can’t compete with Apple in handsets so they are going to try to with MS in software?? yeah that makes sense

  • Anon

    RIM is just a complete failure and deserves a quick death.  It has absolutely NO future.   Why continue flogging a dead horse?

  • Anon

    Probably because RIM is Canadian.  Apple fanboi’s love hearing anything that isn’t an Apple product, fail.

  • LARAE

    @FragilityG4:disqus my ḃudḋy’s ėx-ŵifė mákės $63 áń hour oń thė computeŕ. She hás beeń ŵithout á Job for 10 months but lást month her Ĉheck ŵas $21930 Just working on the cõmputeŕ fõŕ a few hõųŕs. Read moŕe herè..MakeCash2.Com

  • Bsp9493

    Interesting 1st post… I remember similar comment related to apple years ago

    Dont get me wrong, if apple makes it, I own at least one and would love to see the wave of inovative new products continue…

    Bit id also like to see a Canadian company turn itself around and reinvent itself

  • Anon

    Not going to happen anytime soon.  Current CEO doesn’t have an innovative bone in his body.   RIM being a Canadian company is more of an embarrasment to the country, and we can do without it’s constant failures.

  • Djelimon17

    Brought low by bad management. Oh well, better buy what apps I can for the playbook…

  • Christopher Jones

    (thumbs-down)

    Don’t fall for these, there’s a reason when LARAE had to use accents on her letters, so the bots looking to delete these false posts won’t easily find them.

  • djepsilon

    Good thing Jimmy never got that hockey team. He would have run that into the ground too.

  • BassErik

    lazycash1dotcom