RIM Lost $485 Million Due To Unsold PlayBook Inventory
Research In Motion Limited (RIM) today announced that it would record a pre-tax provision in the third quarter of fiscal 2012 of approximately $485 million, $360 million after tax, related to its inventory valuation of BlackBerry PlayBook tablets.
RIM has a high level of BlackBerry PlayBook inventory. RIM hopes that an increase in promotional activity is required to drive sell-through to end customers. This is due to several factors, including recent shifts in the competitive dynamics of the tablet market and a delay in the release of the PlayBook OS 2.0 software.
RIM believes this strategy will accelerate adoption of its QNX-based platform by consumers and enterprises, as well as help to drive the development of an application ecosystem in advance of its next generation BlackBerry smartphones. RIM said that it had sold into the channels approximately 150,000 BlackBerry PlayBook tablets in the third quarter and sell-through to end customers, based on RIM's internal data, was higher than this amount. Since the launch of the new promotions across consumer and enterprise channels in the United States and Canada late in the third quarter, the company has seen a significant increase in demand for the PlayBook.
Both consumer and enterprise customers who purchase a new BlackBerry PlayBook at the current promotional pricing, along with RIM's existing PlayBook customers, will be able to upgrade to the enhanced PlayBook OS 2.0 software at no additional charge when it becomes available in February 2012.
RIM believes this strategy will accelerate adoption of its QNX-based platform by consumers and enterprises, as well as help to drive the development of an application ecosystem in advance of its next generation BlackBerry smartphones. RIM said that it had sold into the channels approximately 150,000 BlackBerry PlayBook tablets in the third quarter and sell-through to end customers, based on RIM's internal data, was higher than this amount. Since the launch of the new promotions across consumer and enterprise channels in the United States and Canada late in the third quarter, the company has seen a significant increase in demand for the PlayBook.
Both consumer and enterprise customers who purchase a new BlackBerry PlayBook at the current promotional pricing, along with RIM's existing PlayBook customers, will be able to upgrade to the enhanced PlayBook OS 2.0 software at no additional charge when it becomes available in February 2012.