Berk Sure Has A Way

Putting my mouth where my money is.

RIMM is likely to guide lower on April 6th

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Research In Motion, the makers of the Blackberry, has lowered guidance on Q4 subscribers not once, but twice.  The main explanation was that uncertainty around the NTP patent has delayed purchases.  I am gonna have to call bullsh*t on that excuse.  I am sure some corporations and government agencies did put off purchasing, but I doubt it was the whole source of the shortfall.  I think that companies are increasingly looking at Blackberry competitors for viable alternatives: Good Technology, Microsoft, Visto, etc.  Also, it is problematic that over two thirds of RIMM’s revenue comes from hardware sales – would Palm be a better play in that arena?

Interestingly, even with the huge Q4 miss RIMM pre-announced this month (slyly done the same day as the NTP patent resolution),  analysts have not lowered expectations for the May Quarter for RIMM.  I suspect RIMM is going to lower subscriber, revenue and earnings guidance for Q1 2007 (May) when they report on April 6th.  I’ve been burned shorting RIMM before, so this time I purchased in-the-money puts that expire in April.

BTW, I use a Treo 650 with Chatteremail and push-IMAP.  I used to use Good Tech when I worked at a corporation.  Both are better (and cheaper) than Blackberry.

I own puts on RIMM shares and calls on PALM.

[Post updated to add external links, my phone preference, PALM disclosure]


Written by Kevin Berk

March 21, 2006 at 1:25 PM

Posted in Picks and Pans

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