Research In Motion Reports First Quarter Results

• Press Release
• Source: Research In Motion
• On 4:05 pm EDT, Thursday June 18, 2009

WATERLOO, ONTARIO--(Marketwire - 06/18/09) - Research In Motion Limited (RIM) (NASDAQ:RIMM - News)(TSX:RIM - News), a world leader in the mobile communications market, today reported first quarter results for the three months ended May 30, 2009 (all figures in U.S. dollars and U.S. GAAP, except where indicated).

Revenue for the first quarter of fiscal 2010 was $3.42 billion, comparable with $3.46 billion in the previous quarter and up 53% from $2.24 billion in the same quarter of last year. The revenue breakdown for the quarter was approximately 81% for devices, 13% for service, 2% for software and 4% for other revenue. During the quarter, RIM shipped approximately 7.8 million devices.

Approximately 3.8 million net new BlackBerry� subscriber accounts were added in the quarter. At the end of the quarter, the total BlackBerry subscriber account base was approximately 28.5 million.

"We are starting fiscal 2010 with strong financial performance and impressive market share gains, including a 55% share of the U.S. smartphone market according to IDC's latest estimate," said Jim Balsillie, Co-CEO at RIM. "The industry leading BlackBerry product portfolio is driving strong customer demand around the world and our penetration of new market segments continues to expand. We are particularly excited about the strength of our product portfolio for fiscal 2010 and we are looking forward to driving continued growth and profitability in our business throughout the remainder of the year."

GAAP net income for the quarter was $643.0 million, or $1.12 per share diluted, compared with net income of $518.3 million, or $0.90 per share diluted, in the prior quarter and net income of $482.5 million, or $0.84 per share diluted, in the same quarter last year. Adjusted net income for the first quarter was $564.4 million, or $0.98 per share diluted. Adjusted net income excludes the impact of certain unusual items that were recognized in the quarter, including a charge to selling, marketing and administration expense of $96.4 million relating to the payment of certain employee tax liabilities relating to certain exercised stock options and the foreign exchange impact relating to the previously disclosed enactment of the functional currency tax rules in Canada that became effective in the first quarter of fiscal 2010. In addition, there was a benefit to RIM's income tax provision of $175.1 million primarily as a result of the enactment of the functional currency tax rules. These unusual items and their related impacts on net income, EPS and selling, marketing and administration expense are summarized in the table below:

�

Reconciliation of GAAP Net income to adjusted net income

                              For the quarter ended May 30, 2009
                           (in thousands, except per share amounts)
             ---------------  ----------------------------------------------
                    Selling,
              marketing and   Income before Provision for       Net Diluted
             administration    income taxes  income taxes    income     EPS
             ---------------  ----------------------------------------------
As reported       $ 514,291       $ 699,197      $ 56,167 $ 643,030  $ 1.12
             ---------------  ----------------------------------------------

Foreign
 exchange
 impact of
 enactment of
 functional
 currency tax
 rules              (54,300)         54,300        16,904    37,396    0.06

Provision for
 employee tax
 obligations
 for stock
 options            (42,132)         42,132        13,180    28,952    0.05

Tax benefit
 recorded on
 enactment of
 functional
 currency tax
 rules                    -               -       145,000  (145,000)  (0.25)
             ---------------  ----------------------------------------------
Sub-total           (96,432)         96,432       175,084   (78,652)  (0.14)
             ---------------  ----------------------------------------------
Adjusted          $ 417,859       $ 795,629     $ 231,251 $ 564,378  $ 0.98
             ---------------  ----------------------------------------------


Note: Adjusted selling, marketing and administration expense, adjusted
      income before taxes, adjusted provision for income taxes, adjusted
      net income and adjusted diluted EPS do not have any standardized
      meanings prescribed by GAAP and thus are not comparable to similarly
      titled measures reported by other issuers. The Company believes that
      the presentation of adjusted net income and adjusted diluted EPS
      enables the Company and its shareholders to better assess RIM's
      operating results relative to its operating results in prior periods
      and improves the comparability of the information presented.
      Investors should consider these non-GAAP financial measures in the
      context of RIM's GAAP results.

Revenue for the second quarter of fiscal 2010 ending August 29, 2009 is expected to be in the range of $3.45-$3.70 billion. Gross margin for Q2 is expected to be approximately 43-44%. Net subscriber account additions in the second quarter are expected to be in the range of 3.8-4.1 million. Earnings per share for the second quarter are expected to be in the range of $0.94-$1.03 per share diluted.

The total of cash, cash equivalents, short-term and long-term investments was $2.42 billion as at May 30, 2009, compared to $2.24 billion at the end of the previous quarter, an increase of $180 million over the prior quarter. Cash flow from operations in Q1 was approximately $615 million which was offset primarily by capital asset and intangible asset acquisitions of approximately $310 million and business acquisitions of approximately $124 million.

A conference call and live webcast will be held beginning at 5 pm ET, June 18, 2009, which can be accessed by dialing 800-733-7571 (North America), 416-644-3415 (outside North America). The replay of the company's Q1 conference call can be accessed after 7 pm ET, June 18, 2009 until midnight ET, July 2, 2009. It can be accessed by dialing 416-640-1917 and entering passcode 21289979#. The conference call will also appear on the RIM website live at 5 pm ET and will be archived at http://www.rim.com/investors/events/index.shtml.

About Research In Motion (RIM)

Research In Motion is a leading designer, manufacturer and marketer of innovative wireless solutions for the worldwide mobile communications market. Through the development of integrated hardware, software and services that support multiple wireless network standards, RIM provides platforms and solutions for seamless access to time-sensitive information including email, phone, SMS messaging, internet and intranet-based applications. RIM technology also enables a broad array of third party developers and manufacturers to enhance their products and services with wireless connectivity. RIM's portfolio of award-winning products, services and embedded technologies are used by thousands of organizations around the world and include the BlackBerry� wireless platform, the RIM Wireless Handheld(TM) product line, software development tools, radio-modems and software/hardware licensing agreements. Founded in 1984 and based in Waterloo, Ontario, RIM operates offices in North America, Europe and Asia Pacific. RIM is listed on the Nasdaq Stock Market (NASDAQ:RIMM - News) and the Toronto Stock Exchange (TSX:RIM - News). For more information, visit www.rim.com or www.blackberry.com.

This news release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and Canadian securities laws, including statements relating to RIM's revenue, gross margin, earnings and net subscriber account additions expectations for the first quarter of fiscal 2010, customer demand, penetration of new markets, product initiatives and anticipated growth. The terms and phrases "continue", "expected", "driving strong customer demand", "looking forward" and similar terms and phrases are intended to identify these forward-looking statements. Forward-looking statements are based on estimates and assumptions made by RIM in light of its experience and its perception of historical trends, current conditions and expected future developments, as well as other factors that RIM believes are appropriate in the circumstances including but not limited to general economic conditions, product pricing levels and competitive intensity, supply constraints and new product introductions. Many factors could cause RIM's actual results, performance or achievements to differ materially from those expressed or implied by the forward-looking statements, including, without limitation: reduced spending by customers and other risks relating to the uncertainty of economic and geopolitical conditions; risks relating to RIM's intellectual property rights; RIM's ability to enhance current products and develop new products and services; RIM's reliance on carrier partners, third-party manufacturers, third-party network developers and suppliers; risks relating to the efficient and uninterrupted operation of RIM's network operations center; risks related to RIM's international operations; and intense competition. These risk factors and others relating to RIM are discussed in greater detail in the "Risk Factors" section of RIM's Annual Information Form, which is included in its Annual Report on Form 40-F and RIM's MD&A (copies of which filings may be obtained at www.sedar.com or www.sec.gov). These factors should be considered carefully, and readers should not place undue reliance on RIM's forward-looking statements. RIM has no intention and undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

The BlackBerry and RIM families of related marks, images and symbols are the exclusive properties and trademarks of Research In Motion Limited. RIM, Research In Motion and BlackBerry are registered with the U.S. Patent and Trademark Office and may be pending or registered in other countries. All other brands, product names, company names, trademarks and service marks are the properties of their respective owners.

�

                        Research In Motion Limited
                  Incorporated under the Laws of Ontario
  (United States dollars, in thousands except per share data)(unaudited)

                   Consolidated Statements of Operations

                                            For the three months ended
                                     ---------------------------------------
                                          May 30,   February 28,     May 31,
                                            2009           2009        2008
----------------------------------------------------------------------------

Revenue                              $ 3,423,510   $  3,463,193 $ 2,242,565
Cost of sales                          1,931,985      2,079,615   1,105,208
                                     ---------------------------------------
Gross margin                           1,491,525      1,383,578   1,137,357
                                     ---------------------------------------
  Gross margin %                            43.6%          40.0%       50.7%

Expenses
 Research and development                219,777        182,535     127,776
 Selling, marketing and
  administration                         514,291        406,493     326,592
 Amortization                             67,396         61,595      36,552
                                     ---------------------------------------
                                         801,464        650,623     490,920
                                     ---------------------------------------

Income from operations                   690,061        732,955     646,437

 Investment income                         9,136         10,568      18,977
                                     ---------------------------------------

Income before income taxes               699,197        743,523     665,414
                                     ---------------------------------------

Provision for income taxes
 Current                                 113,996        223,314     225,658
 Deferred                                (57,829)         1,950     (42,759)
                                     ---------------------------------------
                                          56,167        225,264     182,899

                                     ---------------------------------------
Net income                           $   643,030   $    518,259 $   482,515
                                     ---------------------------------------
                                     ---------------------------------------

Earnings per share
  Basic                              $      1.13   $       0.92 $      0.86
                                     ---------------------------------------
                                     ---------------------------------------
  Diluted                            $      1.12   $       0.90 $      0.84
                                     ---------------------------------------
                                     ---------------------------------------

Weighted average number of common
 shares outstanding (000's)
  Basic                                  566,787        566,105     563,564
  Diluted                                573,259        572,753     574,650

Total common shares outstanding
 (000's)                                 567,368        566,219     564,418



                        Research In Motion Limited
                  Incorporated under the Laws of Ontario
  (United States dollars, in thousands except per share data)(unaudited)

                        Consolidated Balance Sheets

                                                  May 30,       February 28,
As at                                               2009               2009
----------------------------------------------------------------------------

Assets
 Current
  Cash and cash equivalents                  $ 1,135,325        $   835,546
  Short-term investments                         619,914            682,666
  Trade receivables                            2,337,983          2,112,117
  Other receivables                              216,963            157,728
  Inventory                                      634,057            682,400
  Other current assets                           178,964            187,257
  Deferred income tax asset                      226,247            183,872
                                            --------------------------------
                                               5,349,453          4,841,586

Long-term investments                            663,990            720,635
Capital assets                                 1,509,405          1,334,648
Intangible assets                              1,171,551          1,066,527
Goodwill                                         141,067            137,572
Deferred income tax asset                              -                404
                                            --------------------------------
                                             $ 8,835,466        $ 8,101,372
                                            --------------------------------
                                            --------------------------------

Liabilities
 Current
  Accounts payable                           $   612,784        $   448,339
  Accrued liabilities                          1,496,676          1,238,602
  Income taxes payable                            92,323            361,460
  Deferred revenue                                63,916             53,834
  Deferred income tax liability                        -             13,116
                                            --------------------------------
                                               2,265,699          2,115,351

Deferred income tax liability                     53,965             87,917
Income taxes payable                              27,470             23,976
                                            --------------------------------
                                               2,347,134          2,227,244
                                            --------------------------------

Shareholders' Equity
Capital stock                                  2,225,158          2,208,235
Treasury Shares                                  (39,666)                 -
Retained earnings                              4,188,740          3,545,710
Additional paid-in capital                       127,593            119,726
Accumulated other comprehensive income
 (loss)                                          (13,493)               457
                                            --------------------------------
                                               6,488,332          5,874,128
                                            --------------------------------
                                             $ 8,835,466        $ 8,101,372
                                            --------------------------------
                                            --------------------------------



                        Research In Motion Limited
                  Incorporated under the Laws of Ontario
  (United States dollars, in thousands except per share data)(unaudited)

                  Consolidated Statements of Cash Flows

                                           For the three      For the three
                                            months ended       months ended
                                            May 30, 2009       May 31, 2008
----------------------------------------------------------------------------

Cash flows from operating activities
Net income                                   $   643,030        $   482,515

Items not requiring an outlay of cash:
 Amortization                                    128,541             56,679
 Deferred income taxes                           (57,516)           (42,751)
 Income taxes payable                              3,494               (425)
 Stock-based compensation                         12,701              9,900
 Other                                           (25,589)            (1,869)
Net changes in working capital items             (90,038)          (498,533)
                                            --------------------------------
Net cash provided by operating activities        614,623              5,516
                                            --------------------------------

Cash flows from financing activities
Issuance of common shares                         11,542             15,044
Excess tax benefits from stock-based
 compensation                                        547             10,693
Purchase of treasury shares                      (39,666)                 -
Repayment of debt                                 (6,099)               (83)
                                            --------------------------------
Net cash (used in) provided by financing
 activities                                      (33,676)            25,654
                                            --------------------------------

Cash flows from investing activities
Acquisition of long-term investments            (110,112)          (113,696)
Proceeds on sale or maturity of long-term
 investments                                     121,076             95,083
Acquisition of capital assets                   (247,240)          (195,650)
Acquisition of intangible assets                 (63,103)           (96,892)
Business acquisitions                           (124,414)                 -
Acquisition of short-term investments           (156,027)          (173,905)
Proceeds on sale or maturity of short-term
 investments                                     281,430            251,849
                                            --------------------------------
Net cash used in investing activities           (298,390)          (233,211)
                                            --------------------------------

Effect of foreign exchange gain on cash
 and cash equivalents                             17,222              1,860
                                            --------------------------------
Net increase (decrease) in cash and cash
 equivalents for the period                      299,779           (200,181)

Cash and cash equivalents, beginning of
 period                                          835,546          1,184,398
                                            --------------------------------
Cash and cash equivalents, end of period     $ 1,135,325        $   984,217
                                            --------------------------------
                                            --------------------------------



As at                                       May 30, 2009  February 28, 2009
----------------------------------------------------------------------------

Cash and cash equivalents                    $ 1,135,325        $   835,546
Short-term investments                           619,914            682,666
Long-term investments                            663,990            720,635
                                            --------------------------------
                                             $ 2,419,229        $ 2,238,847
                                            --------------------------------
                                            --------------------------------

 
Contacts:
Media Contact:
Brodeur (PR Agency for RIM)
Marisa Conway
(212) 336-7509
mconway@brodeur.com
Investor Contact:
RIM Investor Relations
(519) 888-7465
investor_relations@rim.com