The past week saw a few important announcements made by Qualcomm (NADAQ:QCOM) about its future plans in the wireless chipset industry as well as a possible foray into the PC industry next year. Almost all the stocks in the mobile sector posted losses for the week as the broader market was dragged down by Euro debt concerns. Research in Motion’s (NASDAQ:RIMM) stock fell about 11 % on concerns about its Blackberry 7 phone sales.
Research in Motion
According to a recent report, RBC Capital Markets analyst Mike Abramsky wrote in a note to investors released Monday morning that his checks have shown Blackberry 7 sales seeing a “slowing domestic sell-through, plus impacts from recent service outages and PlayBook challenges (delayed software, sluggish sell-through)”. [1] His findings were in line with an earlier note released last week by Canaccord Genuity analyst Mike Walkley, who had also indicated a similar slowdown in recent weeks. Stalling sales of the company’s latest smartphone is indeed bad news for the company’s floundering plans in the domestic market, where Apple’s iPhone and phones based on Google’s Andoid software have yanked away substantial market share from RIM.
However, Abramsky notes that RIM continues to be the top-selling vendor in the U.K. and Indonesia, and has gained momentum in Latin America. The company’s good international record bodes well for the company but it cannot continue to bank on the international markets to pep up sales, especially as service outages in these markets and battery issues with the new BlackBerry Bold 9900 dent its image and sink sales before long. (see RIM’S BlackBerry Sales Stall as Holiday Season Approaches)
In more recent news, RIM may face a fresh round of calls for management reforms from Northwest & Ethical Investments LP (NEI), should it fail to meet the January 31 deadline for submitting a previously agreed upon management review report. [2] NEI withdrew its earlier proposal for splitting the roles of chairman and chief executive officer in June this year after it had been promised a role in studying management changes at RIM; however, little communication from the company in this regard has NEI concerned about the company’s intentions. If RIM fails to do as promised, NEI will be refiling its proposal for the next year’s annual shareholder meeting.
See our complete analysis for RIM stock here
Qualcomm
- BlackBerry 7 sales stall, PlayBook sell-through remains sluggish, BGR.com, November 21st, 2011 [↩]
- RIM May Face Renewed Investor Push for Management Overhaul, Bloomberg, November 23rd, 2011 [↩]