RIM chiefs slash pay as stock slides

The two chiefs of BlackBerry maker Research In Motion on Thursday slashed their annual pay to a dollar each as the company's stock price sank under the weight of gloomy earnings figures. "The last few quarters have been some of the most trying in the recent history of this company," RIM co-chief Jim Balsillie said while discussing the most recent quarterly earnings on a conference call with analysts. "We recognize our shareholders may feel we've fallen short." Balsillie and fellow RIM chief Mike Lazaridis said they arranged to have their pay slashed to one dollar each per year as they overhaul the company to better compete in the booming smartphone and tablet computer markets. The executives depicted themselves as being among RIM's largest stockholders and vowed to "leave no stone unturned" in evaluating what needs to be changed at the company. The Canada-based firm reported a profit of $265 million, or 51 cents per share, on revenue of $5.2 billion as compared with a net income of $911 million in the same quarter last year. RIM profit in the quarter ended November 26 missed Wall Street forecasts and the stock price dropped more than seven percent to $14.06 in after-hours trading following the release of the figures. RIM said it had yet to finalize its outlook for the current fiscal quarter but preliminary estimates indicated that device shipments would slide and that it would not meet its original forecast of earning $5.20-6.00 per share. A costly BlackBerry service outage and deep discounting of the price of its PlayBook tablet computer were cited as factors in RIM's disappointing financial performance. Sales of the PlayBook have been sluggish since the device hit stores in mid-April with a $499 price tag for the 16-gigabyte model, $599 for the 32GB version and $699 for the 64GB model. Major US retailers Best Buy, Staples and Office Max slashed PlayBook prices to $299, $399 and $499 in September but the device has failed to make inroads in a market dominated by Apple's iPad. RIM said it sold 150,000 PlayBook tablets in the third quarter and 14.1 million BlackBerry smartphones. RIM earnings were also hurt by delays in getting new products to market. Lazaridis said that release of a new BlackBerry 10 smartphone was postponed into next year to wait for availability of more powerful, energy-efficient chips to power handsets. BlackBerry sales have been declining in the United States where the market rewards high-performance smartphones such as the iPhone and Android-powered devices. BlackBerry sales outside the country grew in the recently ended quarter. RIM planned major marketing and promotion campaigns for BlackBerry in the United States. RIM "remained committed" to PlayBooks, with improved operating software for the tablet computers on track for a delayed release in February. PlayBook OS 2.0 is seen as a chance to improve the PlayBook's appeal in the eyes of businesses devoted to the company's smartphones but increasingly tempted by hot Apple or Android mobile gadgets. RIM reported that it has 75 million subscribers in its growing base of BlackBerry users. Ramped up marketing, product releases, and internal changes at RIM would hurt earnings in the short term while making the company more profitable in the long run, according to the chiefs.