Shares of Research In Motion Ltd. jumped Friday morning as investors cheered the company's third fiscal quarter results and forecast -- both of which soundly beat Wall Street's estimates.
In early trades, Research In Motion shares were up more than 10% to $70 U.S. The stock had sold off more than 20% since the last quarterly report, but remains up by 75% since the start of the year.
The results for the November quarter buoyed investors, who had begun to worry that growing competition in the smartphone market was hurting the company's profits.
Earnings for the quarter surged 59% from the same period last year, surpassing Wall Street's estimates. Revenue grew by 41% as both smartphone shipments and subscriber growth also managed to beat previous forecasts.
Its fourth-quarter forecast also exceeded analysts' predictions, as RIM said it expects earnings of $1.23 to $1.31 U.S. on revenue of $4.2 billion to $4.4 billion U.S. On average, analysts were expecting earnings of $1.12 U.S. a share on revenue of $4.1 billion U.S., according to estimates compiled by FactSet Research.
The BlackBerry remains one of the strongest product lines in the fast-growing smartphone business, but RIM is coming under more pressure from competitors. The iPhone from Apple Inc. and new devices from Motorola Inc., HTC and Samsung feature the Android operating system developed by Google Inc. that is gaining ground in the market.
The Motorola Droid launched in November with Verizon Wireless -- one of RIM's largest customers. Analysts had been worried that the carrier's heavy promotion of the device would hurt sales of BlackBerry handsets.
But during a conference call Thursday, RIM Chief Executive Jim Balsillie said the carrier is still a strong supporter of the company's products, including the newly launched touch-screen BlackBerry Storm 2.
Some still believe that RIM will not remain immune to new competition. Much of the company's revenue growth from the quarter came from its international markets, where it faces less intense competition.
