RIM reports 45 per cent gain in year-over-year third-quarter profit

BlackBerry maker Research in Motion Ltd. (TSX:RIM) reported an increase in quarterly profits Thursday, helped again by international growth.

RIM, which keeps its books in U.S. dollars, said Thursday it earned US$911.1 million, or $1.74 per diluted share, for its third quarter.

That compared with a profit of $628.4 million or $1.10 per share a year ago. Revenue for the quarter totalled $5.49 billion, up from $3.92 billion.

“BlackBerry was the No.1 smartphone for the third consecutive quarter in Latin America,” co-CEO Jim Balsillie said told a conference call with financial analysts as he reviewed the company’s international sales.

Balsillie said pre-paid BlackBerrys were the top sellers in country’s such as Indonesia and the Netherlands, appealing to young consumers who like text messaging and social networking.

Most of the Waterloo, Ont., company’s growth has come from international sales in recent quarters, prompting analysts to wonder if RIM’s best days are behind it.

While RIM was expected to report strong quarterly results, the success of its PlayBook tablet is considered essential to its future.

Balsillie said the PlayBook will be out next year.

“The PlayBook is expected to begin shipping in the United States in the first quarter of 2011,” he said, noting the tablet will have WiFi only and be sold at retailers.

Apple recently surpassed RIM to become the world’s fourth largest mobile phone vendor reflecting the release of the latest version of the company’s iPhone, tech trends firm IDC has reported.

Apple’s market share globally increased to just more than four per cent, up from 2.5 per cent in the same quarter last year, IDC said. RIM’s market share was 3.6 per cent, up from 2.9 per cent.

In the competitive North American market, BlackBerrys have lost market share to iPhones and smartphones using Google’s Android operating system.

But Balsillie appeared confident of RIM’s continued success, saying its upcoming smartphone, tablet and service offerings are “setting the stage for continuing success.”

The average analyst estimate had been for a profit of $1.62 per share according to Thomson Reuters. Revenue was expected to be $5.23 billion in the quarter.

BMO Capital Markets analyst Tim Long called the results “another solid beat.”

The results were “way better than our above-consensus estimates, and guidance was even more positive,” Long wrote in a research note.

Long said revenue was above his estimate of $5.42 billion and consensus of $5.46 billion. Earnings per share was above his estimate of $1.67.

“We remain positive on the stock and view this quarter as another step toward improving sentiment,” Long wrote.

Shares in the company, which reported its results after the close of markets, were up 13 cents at C$59.61 on the Toronto Stock Exchange.

RIM said it added about 5.1 million net new BlackBerry subscribers in the quarter to bring the total subscriber account base to over 55 million.

RIM shipped 14.2 million devices during the quarter.

In its outlook for the company’s fourth quarter, RIM said it expected revenue between $5.5 billion and $5.7 billion, while earnings per share in the quarter were expected to be in the range of $1.74 to $1.80 per diluted share.

RIM also announced that Balsillie and co-chief executive Mike Lazaridis, both directors of the company, have been named co-chairmen of the board. John Richardson remains as lead independent director.

The company also said director Jim Estill has resigned from the board due to a business conflict.