Sometimes a little rumor in the tech industry can go a long way.
Following whispers that billionaire investor Carl Icahn has taken a stake in the company, shares of BlackBerry-maker Research In Motion surged Tuesday, according to media reports.
As the Waterloo, Canada-based smartphone maker struggles to stay relevant amid two dominant mobile operating systems – Apple’s iOS and Google's Android – traders “are saying Icahn has taken a stake, but nothing is confirmed,” BGC Partners tech analyst Colin Gillis told Reuters, as the shares grew $1.42, or 6.5 percent, to $23.04 on the Nasdaq.
Icahn’s publicly-traded holding company, Icahn Enterprises, invests in real estate, metals, rail cars and automotive companies, according to Forbes. The 75-year-old New York City resident is reportedly worth $13 billion.
While Research in Motion shares have been on a nearly constant decline since February, the Associated Press reported “Icahn is already set to cash in an 11.4 percent stake worth more than $1.3 billion in Motorola Mobility Holdings Inc., after Google Inc. declared it was buying the cellphone maker, mainly for its trove of cellphone patents.”
The troubled smartphone maker recently reported a sharp drop in net income and revenue on Thursday and said it sold far fewer tablet computers than it expected, TechZone360 reported.
Following its Q2 2012 earnings report Sept. 15, shares plummeted more than 19 percent as the crisis at the once high-flying tech company intensified. RIM reported its net income was 419 million, or 80 cents per share, in the three months ended Aug. 27. That's down from $796.7 million, or $1.46 per share, a year ago, according to the AP. Analysts expected 90 cents per share, according to a survey by FactSet. The company said revenue fell 15 percent to $4.2 billion.
Responding to lagging sales, Research In Motion retailers recently started cutting prices on the BlackBerry PlayBook tablet, TechZone360 reported. During the company’s 2Q 2012 earnings call earlier this month, RIM officials said revenue for the third quarter of fiscal 2012 ending November 26, 2011 is expected to be in the range of $5.3 billion to $5.6 billion.
Executive Editor, Strategic Initiatives
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