Investors greeted new Research in Motion CEO Thorsten Heins by promptly dumping the company’s shares on Monday, as analysts and industry observers questioned whether the shakeup will reverse the Blackberry-maker’s waning fortunes.
In several interviews and a video posted by the company, Heins insisted that the company is on the right track and no major change is needed. But the market wasn’t buying it, and by midday Monday RIM shares had fallen nearly 7%.
For the last several years, RIM has been steadily losing the dominant position it once held in the smartphone market. As recently as 2009, the BlackBerry was still the top smartphone-maker, thanks to its commanding lead in the corporate market. But as RIM was resting on its laurels as the favored device of Wall Street and Capitol Hill, Apple and Google were taking aim the consumer smartphone market, which was poised to explode.
Today, BlackBerry’s market share stands at 17%, well behind Android, which leads with 44.2%, followed by the iPhone, with 28.6%, according to recent mobile operating system market data from Nielsen.
RIM’s stock price declined by over 70% in 2011, and last month the company said that fourth-quarter sales fell 6% from the previous year. Profit, meanwhile, plummeted 71%, though much of that drop was attributed to a $485 million pretax charge from the company’s large inventory of unsold PlayBook tablets.
Given such performance, RIM’s co-CEOs Jim Balsillie and Mike Lazaridis, who had spent 20 years running the company, faced growing calls to step down, and on Sunday did just that. Heins, who had been the RIM’s chief operating officer after joining the company in 2007, was named to replace them.