Research In Motion’s (NASDAQ: RIMM) BlackBerry continues to see booming traction in the enterprise, with the smartphone maker reporting that it added 2.3 million new accounts during the quarter.
But despite those numbers — and a jump in both revenue and profit from the same quarter last year — Wall Street soured on the stock after the company missed earnings estimates by a penny and gave disappointing guidance for next quarter.
RIM said income totaled $482.5 million, or 84 cents a share, in its first fiscal quarter ended May 31 — a performance in-line with company guidance. A year earlier, profit topped $223.2 million, or 39 cents a share.
“We are pleased with our results as our earnings more than doubled,” Co-CEO Jim Balsillie told investors during the company’s earnings call.
But analysts polled by Thomson Reuters expected a 1-cent greater per-share quarterly profit. In addition, the company gave guidance of 84 cents to 89 cents for second quarter, again below estimates of 90 cents per share.
The news sent shares of RIMM tumbling in after-hours trading, down 7.61 percent, to $10.84.
The punishment also comes despite soaring revenues, with first quarter’s sales coming in at $2.24 billion, up 19 percent from the previous quarter. That sum also represents a 107 percent jump from $1.08 billion in the same quarter of last year.
The company said it now has over 16 million subscribers, with 375 carriers worldwide selling BlackBerry products.
Balsillie spent the majority of his presentation mentioning product and strategy moves RIM has made in past few months, citing them as reasons for device and subscriber growth.
In April, RIM tailored its service for small to midsized businesses seeking an enterprise-style solution in a cheaper, simpler-to-deploy package.
A month later, it debuted its newest BlackBerry, the Bold, offering what the Ottawa-based vendor claims is greater performance and functionality, thanks to high-speed network capabilities and a heftier processor.
First-quarter device sales accounted for 82 percent of the company’s revenue, with services representing 13 percent, and software sales comprising 3 percent.
The device sales figure match research predictions earlier this year that reported IT leaders are spending more on BlackBerrys despite tightening tech budgets.
Enterprise adoption growth, according to Balsillie, is tied to the “exceptional” reception the Bold product is experiencing due to its application integration aspects. In May, enterprise software giant SAP announced that it had natively integrated its customer relationship management (CRM) application into hand-held device.
“That further evolved the model of application integration,” Balsillie said, adding that the deal with SAP was just the first phase of RIM’s relationship with the software provider.
Going forward, RIM said it believes new pricing plans will provide even greater strength to its market share, but did not provide specifics related to U.S.-based carrier programs.
Company executives also said RIM would advance its Wi-Fi handset capabilities, as well as continue to invest in voice recognition and unified communications capabilities.
All those plans are part of increasing research and development efforts that RIM said would continues into second quarter. The R&D effort is about “investing to drive the top line,” Balsillie said.
The company also opened two new R&D centers, in Germany and South Florida, and hired about 130 engineers for each. Staffing could potentially reach 1,000 at each center, he added.
“This is an adoption acceleration game, and our model is so powerfully positive for carriers,” he said. “The focus is to keep the growth growing.”