After Research in Motion (RIM) posted its first quarterly loss on Thursday, and saw co-founder Jim Balsillie resign from its board, the company’s new CEO, Thorsten Heins, acknowledged that “strategic opportunities” needed to be explored.
“I have assessed many aspects of RIM’s business during my first 10 weeks as CEO. I have confirmed that the Company has substantial strengths that can be further leveraged to improve our financial performance,” said Thorsten Heins, President and CEO of Research In Motion in a statement. “We are undertaking a comprehensive review of strategic opportunities to leverage RIM’s assets and maximize value for our stakeholders.”
RIM lost $125-million this past quarter, compared to a profit of $934-million a year prior.
By “strategic opportunities”, CEO Heins likely means selling parts of RIM’s lucrative patent portfolio or licensing technology to competitors. RIM made inroads into technology licensing last November with the release of the hardware agnostic smartphone management tool, Blackberry Mobile Fusion.
While “strategic opportunities” may often mean prepping a company for acquisition, sources familiar with the matter have reported to Reuters that a sale is unlikely.
“They are not having any dialogue with private equity or strategics,” one source, speaking on the condition of anonymity, told Reuters.
According to these sources, the newest member of RIM’s board of directors, Prem Watsa, wants to give CEO Heins some time to turn the troubled company around.
“Prem Watsa is really very influential there now,” the source said. “They want to give [CEO Heins] the opportunity to keep his head down and focus on the business.”
RIM has been the subject of takeover speculation before: Microsoft, Nokia, and Amazon have all at one time expressed interest as potential suitors.
While the market has responded positively to CEO Heins’ vision, as shares rose nearly 7 percent during Friday trading, analysts have mixed opinions on the future of RIM.
“With the very disappointing strategic directions of the company, we recognize that remaining short on RIM is tempting,” wrote Pierre Ferragu of Bernstein Research. “We think the company will continue to lose traction until it showcases its next generation of products based on QNX, and the latter is very unlikely to generate renewed consumer traction.”
“It is clear that the company is in survival mode,” countered Charter Equity analyst Ed Snyder.
“RIM is in a dire state of affairs.”