Research In Motion Ltd. (RIMM) reported a fourth-quarter loss Tuesday as sizzling sales of its BlackBerry (search) wireless e-mail device were offset by the cost of settling a patent infringement lawsuit with NTP Inc (search).
RIM reported a loss of $2.6 million, or 1 cent per share, in the fourth quarter, ended Feb. 26, compared with net income of $41.5 million, or 23 cents a share, in the corresponding period a year earlier.
Adjusted to exclude a charge of $294.2 million to resolve the NTP litigation and a related tax recovery of $151.6 million, net income was $140.1 million, or 71 cents a share.
Revenue nearly doubled to $404.8 million from $210.6 million a year earlier.
Analysts had expected a profit of 65 cents a share before exceptional items, on revenues of $410 million, according to Reuters Estimates.
RIM shares fell $2.95, or 4 percent, to $71.45 on the electronic Inet brokerage system from their close of $74.40 on Nasdaq. The stock closed at C$90.89 in Toronto, down 76 Canadian cents.
"Overall, subscribers were strong, EPS was strong, revenue was about $5 million light, about 1 percent, but traders are going to key off of little things like that," said American Technology Research analyst Rob Sanderson.
In December, RIM had forecast fourth-quarter revenue of $390 million to $410 million, earnings per share of 48 cents to 54 cents, or 60 cents to 67 cents a share adjusted.
Waterloo, Ontario-based RIM agreed last month to pay $450 million to settle its three-year patent dispute with closely held NTP Inc.
NTP, a U.S.-based patent holding company had successfully sued RIM in 2002 for patent infringement and later won an injunction that could have halted U.S. sales of the thumb-operated BlackBerry, which helped popularize mobile e-mailing.
RIM said in March that the settlement included $137 million already held in escrow, with much of the remaining $313 million to be expensed in the fourth quarter.
The number of BlackBerry subscribers increased by 470,000 from the third quarter to about 2.51 million, more than double the 1.07 million subscribers RIM had a year earlier.
Co-chief executive Jim Balsillie said in a statement the company expects to surpass 3 million BlackBerry subscribers in the current quarter and plans to launch BlackBerry with an additional 100 carriers this year.
RIM forecast first-quarter subscriber additions of 560,000 to 590,000.
The company maintained its first-quarter revenue forecast of $430 million to $455 million. It forecast second-quarter revenues of $460 million to $485 million.
In December, RIM had forecast first-quarter earnings per share of between 51 cents and 57 cents, or 64 cents to 71 cents adjusted.
It said it now expects first-quarter earnings in the range of 51 cents to 56 cents per share, and second-quarter earnings per share of between 57 and 63 cents per share.
Analysts had expected an adjusted first-quarter profit of 68 cents a share on revenues of $452.7 million. For the second quarter, analysts had forecast an adjusted profit of 68 cents on revenue of $492.7 million.
Sanderson said some traders were likely disappointed by RIM's second-quarter sales outlook.