Troubled BlackBerry maker Research in Motion's woes look to have taken another turn for the worse, with a bleaker than expected financial outlook for the company adding to its struggle to regain momentum.
Research In Motion has been forced to lower expectations on its next quarterly financial statement. Image credit: Ben Woods
Thorsten Heins, RIM's chief executive, delivered the bad news in an interim business update on Tuesday.
"In terms of challenges, as I mentioned on the March financial results conference call, RIM is going through a significant transformation as we move towards the BlackBerry 10 launch, and our financial performance will continue to be challenging for the next few quarters," Heins said in a statement on Tuesday.
"The ongoing competitive environment is impacting our business in the form of lower volumes and highly competitive pricing dynamics in the marketplace, and we expect our Q1 results to reflect this, and likely result in an operating loss for the quarter."
While RIM's inability to adapt to the fast-changing mobile market is not news, a number of factors currently coming to a head suggest that crunch time could be coming for the Canadian smartphone maker, not least of which was confirmation that it had drafted in bankers from JP Morgan and RBC Capital to consider options for the future of the company.
Additionally, a Bloomberg report on Tuesday raised the prospect that RIM may have to make another writedown due to a significant build-up of unsold hardware. However, financials watchers will have to wait until 28 June when the company reports its quarterly figures in full.
Adding to the escalating problems facing the company are a number of changes in its key personnel. Within the last two weeks, both RIM's chief legal officer and its global head of sales have decided to part ways with the handset manufacturer, adding more disruption to an executive team that has already seen long-standing co-chiefs Jim Balsillie and Mike Lazaridis step down from their roles in January.
The company's troubles don't end there: according to reports, as a result of its poor performance — largely due to an inability to compete with devices running the Google Android or Apple iOS platform — RIM is also considering cutting its workforce by 12 percent in order to achieve $1bn in savings by the end of fiscal year 2013.
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