RIM stock falls on BellSouth results
July 23, 2001, 1:15 p.m. PT
Shares of Research In Motion fell as much as 16 percent Monday after telephone company BellSouth results showed declining subscriber growth for what investors extrapolated was the BlackBerry two-way e-mail pager.
Shares of RIM closed down $3.87, or 13 percent, to $24 on Monday, after falling as low as $23.20 earlier in the day.
Interactive subscribers at BellSouth’s Cingular Interactive, which analysts caution is not entirely comprised of RIM’s BlackBerry pagers, grew by only 32,000 customers in the second quarter, down from growth of 80,000 in the same period last year.
“It is believed that RIM makes up the vast majority of these subscribers,” said Dundee Securities analyst Mark Hugh Sam, adding that Cingular does not break out the specific numbers.
Nevertheless, investors are worried because RIM’s pagers and handhelds comprise more than 50 percent of the Canadian company’s current revenue, analysts added.
The BellSouth results contradict RIM’s recent reiteration of earnings projections for the current quarter.
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