RIM BlackBerry 10 smartphones delayed, PlayBook written off

Research in Motion wrote off $485 million worth of PlayBooks that it was unable to sell, as net income and revenue both fell significantly from a year ago.

RIM also said that a delay in a key dual-core chip will push back the release of the company's first BlackBerry 10 smartphones to the latter half of 2012.

Both Jim Balsillie and Mike Lazaridis, the company's co-chief executive officers, said that they asked the company's compensation committee to reduce their respective salaries to just a dollar, even as a cross-management team works to cut costs. Balsillie said that the decision had been made because of a perception that the company's management had "fallen short" of expectations.

In all, RIM reported a number of future disappointments, even as the company's top line continued in the black, thanks to its success overseas. RIM was profitable, even through net income fell to $265 million from $911 million a year ago. Revenue fell 5 percent from the same period, from $5.5 billion to $5.2 billion.

"We ask for your patience and confidence and hope to report further progress in the coming quarters," Lazaridis said in a conference call with analysts.

RIM touted its strong international presence and hardware sales. Overall, RIM sold 14.1 million BlackBerrys, but only 150,000 PlayBook tablets. Hardware revenue was up 56 percent—but outside the United States. "RIM's U.S. business was particularly weak," Balsillie said.

Lazaridis said that RIM will ship the next version of the PlayBook operating system in February, known as PlayBook 2.0. Together with native email, calendar, and contacts, there will be integration with the Android player. Enterprise features will include an enterprise app store, and BlackBerry Balance, which will balance enterprise security and apps with the user's ability to use PlayBook as a personal device.

"While we would have preferred the initial PlayBook launch to have been smoother, I firmly believe it is the most secure and advanced platform in the market today," Lazaridis said.

"We're completely committed to the PlayBook," Lazaridis said.

The latest delay in the BlackBerry 10 platform, which will take the QNX OS that RIM used in the PlayBook, was due to a highly integrated, dual-core, LTE chipset that will not be available until mid-2012. That, in turn, delayed RIM's phones.

"We decided we wanted to get a high-efficiency, low-power integrated chipset," Lazaridis said. "We wanted the performance and battery-life expectations that consumers expected on BlackBerry products on LTE."

Next year, RIM will undertake a substantial advertising and promotion campaign to resuscitate the company's image. RIM said it expects to sell between 11 million and 12 million smartphones, and record $4.6 billion and $4.9 billion in revenue.

At the same time, RIM has formed CORE, an effort to reduce costs by looking at streamlining business practices: "ways to do things better," Lazaridis said. It will not be focused on lowering headcount, he said.

"We have a commitment to leaving no stone unturned when evaluating [financial] performance," Lazaridis said.

This article, written by Mark Hachman, originally appeared on PCMag.com and is republished on Gear Live with the permission of Ziff Davis, Inc.