RIM Shares Rally on Gift of Upbeat Guidance, but Concerns Remain on Shrinking Gross Margins

December 19, 2008 at 2:07 pm PT

Santa is supposed to live at the North Pole. But apparently, he’s moved to Waterloo, Ontario.

Research In Motion (RIMM) yesterday gave a pre-Xmas gift to investors, providing guidance for the fiscal fourth quarter ending in February that exceeded Street expectations. Almost no company on the Street has been able to do that in the current environment. RIM forecast revenue for the quarter of $3.3 billion to $3.5 billion, with profits of 83-91 cents a share; that compared to the old consensus forecast of $2.99 billion and 83 cents.

The one sticky bit is that the company sees gross margin for the quarter of 40-41 percent, down from 45.6 percent in the November quarter.

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Tagged with: Barrons, Eric Savitz, fourth quarter, frontpage, gross margin, Research In Motion, Santa, Tech Trader Daily, Xmas

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