Research In Motion Reports Third Quarter Fiscal 2013 Results

WATERLOO, ONTARIO, Dec 20 (MARKET WIRE) --
Research In Motion Limited (RIM) (NASDAQ:RIMM)(TSX:RIM), a world leader
in the mobile communications market, today reported third quarter results
for the three months ended December 1, 2012 (all figures in U.S. dollars
and U.S. GAAP, except where otherwise indicated).

Highlights:

-- Cash increase of approximately $600 million to $2.9 billion
-- Cash flow from operations was approximately $950 million
-- Revenue of $2.7 billion
-- GAAP net income from continuing operations of $14 million, or $0.03 per
share diluted, including a $166 million favorable tax settlement
-- Adjusted net loss of $114 million, or $0.22 per share diluted
-- BlackBerry subscriber base of approximately 79 million users
-- Shipments of 6.9 million smartphones and 255,000 PlayBooks
-- RIM's Chief Information Officer, Robin Bienfait, announces retirement

Q3 Results

Revenue for the third quarter of fiscal 2013 was $2.7 billion, down 5%
from $2.9 billion in the previous quarter and down 47% from $5.2 billion
in the same quarter of fiscal 2012. The revenue breakdown for the quarter
was approximately 60% for hardware, 36% for service and 4% for software
and other revenue. During the quarter, RIM shipped approximately 6.9
million BlackBerry smartphones and approximately 255,000 BlackBerry
PlayBook tablets.

GAAP net income for the quarter from continuing operations was $14
million, or $0.03 per share diluted. GAAP net income for the quarter,
including loss from discontinued operations, was $9 million, or $0.02 per
share diluted, compared with the GAAP net loss of $235 million, or $0.45
per share diluted, in the prior quarter and a GAAP net income of $265
million, or $0.51 per share diluted, in the same quarter last year.

Adjusted net loss for the third quarter was $114 million, or $0.22 per
share diluted. Adjusted net loss and adjusted diluted loss per share
exclude the impact of pre-tax charges of $55 million ($38 million on an
after-tax basis) related to the Cost Optimization and Resource Efficiency
("CORE") program and excludes the impact of an income tax benefit of $166
million. These impacts on GAAP net income from continuing operations and
diluted earnings per share are summarized in the table below.

"RIM continued to execute on its product roadmap plans and to deliver on
key financial metrics as it gets set for the global launch of BlackBerry
10," said Thorsten Heins, President and CEO. "During the third quarter,
we continued to demonstrate our strong financial position, generating
$950 million in cash flow from operations, and increasing our cash
position significantly to more than $2.9 billion. More than 150 carriers
are currently completing technical acceptance programs for the first
BlackBerry 10 products, and beta trials of BlackBerry Enterprise Service
10 are underway at more than 120 enterprises including 64 Fortune 500
companies. This is an exciting time and our carrier partners, application
developers and employees are all looking forward to unveiling the
innovation and excitement of BlackBerry 10 to our customers on January
30, 2013."

RIM also announced today that Robin Bienfait, Chief Information Officer
for RIM has made the decision to retire at the end of this year following
6 years of service to the Company. Robin has committed to continue
supporting RIM in an advisory capacity to enable a smooth launch and
seamless transition.

Under Robin's watch, the BlackBerry service infrastructure has grown from
47 petabytes per year to more than 33 petabytes per month at the same
time as the internal corporate infrastructure for RIM has grown at a
remarkable pace. Robin joined RIM in the beginning of 2007 with the
mandate to take RIM's BlackBerry data services infrastructure from a
single presence in Canada to a distributed model connecting to over 650
carrier partners worldwide. In addition, over this past year, Robin has
led RIM's Enterprise business unit focused on enabling services for
Enterprise customers and preparing for the launch of the BlackBerry 10
platform. Robin has led a distinguished career. Before joining RIM, Robin
held a number of senior leadership positions at AT&T and Bell Labs for
over 22 years.

"Robin has been an outstanding CIO and has built a world class
organization. Her team has diligently prepared us for the launch of
BlackBerry 10 and beyond, and I will remain deeply grateful for her
leadership and commitment," said Thorsten Heins, President and CEO of
Research In Motion.

Outlook

The Company expects that there will be continued pressure on operating
results as it gets set to launch its BlackBerry 10 platform in the fourth
quarter. The Company intends to continue to consider using pricing
initiatives on BlackBerry 7 devices and service fees in some markets as a
way to maintain our subscriber base and drive more BlackBerry users. The
timing of the BlackBerry 10 launch event for January 30, 2013 could also
impact sales of current BlackBerry 7 products as some customers may defer
purchasing decisions and wait for BlackBerry 10 devices. All these
factors are expected to impact unit volumes, subscribers, margins and
service fees. In addition, the company will be significantly increasing
its marketing spending this quarter as expected, to support the global
launch of BlackBerry 10, and the Company expects to report an operating
loss for the fourth quarter. Further details about the Company's outlook
will be discussed on the conference call and live webcast to be held
beginning at 5 pm ET today, information for which is set forth below.

Reconciliation of GAAP net income and diluted earnings per share from
continuing operations to adjusted net loss and adjusted diluted loss per
share from continuing operations:

(United States dollars, in millions except per share data)

For the quarter ended December 1,
2012
-----------------------------------
Net income Diluted earnings
(loss) from (loss) per share
continuing from continuing
operations (net operations (net
of income tax) of income tax)
-----------------------------------
As reported $ 14 $ 0.03

Adjustment:
CORE Program (net of tax)(1) 38 0.07
Income Tax Benefit(2) (166) (0.32)

-----------------------------------
Adjusted $ (114) $ (0.22)
-----------------------------------
-----------------------------------

----------------------------------------------------------------------------

Note: Adjusted net loss and adjusted diluted loss per share from
continuing operations do not have a standardized meaning prescribed by
GAAP and thus are not comparable to similarly titled measures presented
by other issuers. The Company believes that the presentation of adjusted
net loss and adjusted diluted loss per share from continuing operations
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 measures in the context of RIM's GAAP results.

(1) As part of the Company's ongoing effort to streamline its operations
and increase efficiency, the Company commenced the CORE program in
March 2012. During the third quarter of fiscal 2013, the Company
incurred approximately $55 million in total pre-tax charges related to
the CORE program. Substantially all of the pre-tax charges are related
to one-time employee termination benefits, facilities costs and
manufacturing network simplification costs. During the third quarter of
fiscal 2013, pre-tax charges of approximately $32 million were included
in cost of sales, charges of approximately $4 million were included in
research and development and charges of approximately $19 million were
included in selling, marketing, and administration expenses. Additional
charges for headcount related costs associated with the CORE program
will also be incurred in subsequent quarters.
(2) Reflects the favorable impact of the settlement of uncertain income tax
positions, including related interest and foreign exchange gains, the
Company recorded in the third quarter of fiscal 2013 that resulted from
the restructuring of RIM's international operations.

Conference Call and Webcast

A conference call and live webcast will be held beginning at 5 pm ET,
December 20, 2012, which can be accessed by dialing-1-800-814-4859 (North
America), (+1)416-644-3414 (outside North America), or through your
personal computer or BlackBerry(R) PlayBook(TM) tablet at
www.rim.com/investors/events/index.shtml. A replay of the conference call
will also be available at approximately 7 pm ET by dialing
(+1)416-640-1917 and entering pass code 4501370#. A replay of the webcast
will be available on your personal computer or BlackBerry PlayBook tablet
by clicking the link above. This replay will be available until midnight
ET, January 3, 2013.

About Research In Motion

Research In Motion (RIM), a global leader in wireless innovation,
revolutionized the mobile industry with the introduction of the
BlackBerry(R) solution in 1999. Today, BlackBerry products and services
are used by millions of customers around the world to stay connected to
the people and content that matter most throughout their day. Founded in
1984 and based in Waterloo, Ontario, RIM operates offices in North
America, Europe, Asia Pacific and Latin America. RIM is listed on the
NASDAQ Stock Market (NASDAQ:RIMM) and the Toronto Stock Exchange
(TSX:RIM). 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 regarding: RIM's plans and
expectations relating to the global launch of BlackBerry 10, including
the timing of the January 30, 2013 launch event; RIM's expectation that
there will be continued pressure on operating results in the fourth
quarter of fiscal 2013; RIM's intention to continue to use pricing
initiatives to maintain its subscriber base and drive more BlackBerry
users; the anticipated impact of the timing of the BlackBerry 10 launch
on sales of current BlackBerry 7 products; expectations regarding lower
unit volumes, subscribers, margins and service fees; anticipated
marketing spending in the fourth quarter of fiscal 2013; the Company's
current expectation that it will report an operating loss in the fourth
quarter of fiscal 2013; and the Company's anticipated cash position in
the fourth quarter of fiscal 2013. The terms and phrases "continued",
"get set", "completing", "underway", "looking forward", "expects",
"intends", "drive", "could", "may", "will", "anticipates", 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, the
timing and success of new product introductions, RIM's expectations
regarding its business, strategy, opportunities and prospects, including
its ability to implement meaningful changes to address its business
challenges, and RIM's expectations regarding the cash flow generation of
its business. 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:
RIM's ability to enhance current products and develop new products and
services in a timely manner or at competitive prices, including risks
related to further delays in new product introductions, including the
Company's BlackBerry 10 smartphones; risks related to intense
competition, including RIM's ability to compete in the tablet market,
strategic alliances or transactions within the wireless communications
industry, and risks relating to RIM's ability to maintain or grow its
services revenues including risks related to the anticipated decline in
RIM's infrastructure access fees and RIM's ability to mitigate the impact
of such decline on its consolidated revenues; RIM's reliance on carrier
partners and distributors; risks relating to network disruptions and
other business interruptions, including costs, potential liabilities,
lost revenue and reputational damage associated with service
interruptions; RIM's ability to manage inventory and asset risk; RIM's
ability to implement and realize the anticipated benefits of its CORE
program; RIM's ability to maintain or increase its cash balance; security
risks and risks related to the collection, storage, transmission, use and
disclosure of confidential and personal information; RIM's ability to
attract and retain key personnel; RIM's ability to adapt to recent
management changes and headcount reductions; RIM's reliance on suppliers
of functional components for its products and risks relating to its
supply chain; RIM's ability to maintain and enhance the BlackBerry brand;
risks related to RIM's international operations; risks related to
government regulations, including regulations relating to encryption
technology; RIM's reliance on third-party network infrastructure
developers, software platform vendors and service platform vendors; RIM's
ability to expand and manage its BlackBerry App World applications
catalogue; RIM's reliance on third-party manufacturers;
potential defects and vulnerabilities in RIM's products; risks relating
to litigation, including litigation claims arising from the Company's
past practice of providing forward-looking guidance; RIM's ability to
manage its past growth and its ongoing development of service and support
operations; potential additional charges relating to the impairment of
goodwill or other intangible assets recorded on RIM's balance sheet;
disruptions to RIM's business as a result of shareholder activism; risks
related to intellectual property; and difficulties in forecasting RIM's
financial results given the rapid technological changes, evolving
industry standards, intense competition and short product life cycles
that characterize the wireless communications industry. 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 the "Cautionary Note
Regarding Forward-Looking Statements" section of 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 millions except share and per share amounts)
(unaudited)

Consolidated Statements of Operations

For the nine months
For the three months ended ended
--------------------------------- ----------------------
December September November December November
1, 2012 1, 2012 26, 2011 1, 2012 26, 2011
----------------------------------------------------- ----------------------

Revenue $ 2,727 $ 2,861 $ 5,166 $ 8,396 $ 14,242
Cost of sales 1,897 2,117 3,759 6,036 9,067
--------------------------------- ----------------------
Gross margin 830 744 1,407 2,360 5,175
--------------------------------- ----------------------

Gross margin % 30.4% 26.0% 27.2% 28.1% 36.3%

Operating expenses
Research and
development 393 366 366 1,126 1,170
Selling, marketing
and administration 487 556 567 1,589 1,954
Amortization 180 180 146 533 419
Impairment of
goodwill - - - 335 -
--------------------------------- ----------------------
1,060 1,102 1,079 3,583 3,543
--------------------------------- ----------------------

Operating income
(loss) (230) (358) 328 (1,223) 1,632

Investment income,
net 18 - 2 21 16
--------------------------------- ----------------------

Income (loss) from
continuing
operations before
income taxes (212) (358) 330 (1,202) 1,648

Provision for
(recovery of)
income taxes (226) (129) 65 (480) 359
--------------------------------------------------------

Income (loss) from
continuing
operations 14 (229) 265 (722) 1,289

Loss from
discontinued
operations, net of
tax (5) (6) - (22) -

--------------------------------- ----------------------
Net income (loss) $ 9 $ (235) $ 265 $ (744) $ 1,289
--------------------------------- ----------------------
--------------------------------- ----------------------

Earnings (loss) per
share

Basic and diluted
earnings (loss)
per share from
continuing
operations 0.03 (0.44) 0.51 (1.38) 2.46

Basic and diluted
loss per share
from discontinued
operations (0.01) (0.01) - (0.04) -
--------------------------------------------------------
Total basic and
diluted earnings
(loss) per share $ 0.02 $ (0.45) $ 0.51 $ (1.42) $ 2.46
--------------------------------- ----------------------
--------------------------------- ----------------------

Weighted-average
number of common
shares outstanding
(000's)

Basic 524,160 524,160 524,139 524,160 524,079
Diluted 524,852 524,160 524,139 525,541 524,279

Total common shares
outstanding (000's) 524,160 524,160 524,160 524,160 524,160

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

Consolidated Balance Sheets

December 1, March 3,
As at 2012 2012
----------------------------------------------------------------------------

Assets
Current
Cash and cash equivalents $ 1,910 $ 1,516
Short-term investments 821 247
Accounts receivable, net 2,174 3,062
Other receivables 366 486
Inventories 457 1,027
Income taxes receivable 333 135
Other current assets 478 356
Deferred income tax asset 217 195
Assets held for sale 70 32
----------------------------
6,826 7,056

Long-term investments 207 337
Property, plant and equipment, net 2,493 2,748
Goodwill - 304
Intangible assets, net 3,113 3,286
----------------------------
$ 12,639 $ 13,731
----------------------------
----------------------------

Liabilities
Current
Accounts payable $ 661 $ 744
Accrued liabilities 1,844 2,382
Deferred revenue 555 263
----------------------------
3,060 3,389

Deferred income tax liability 225 232
Income taxes payable 12 10
----------------------------
3,297 3,631
----------------------------

Shareholders' Equity
Capital stock and additional paid-in capital 2,417 2,446
Treasury stock (242) (299)
Retained earnings 7,169 7,913
Accumulated other comprehensive income (loss) (2) 40
----------------------------
9,342 10,100
----------------------------
$ 12,639 $ 13,731
----------------------------
----------------------------

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

Consolidated Statements of Cash Flows

For the nine months ended
------------------------------
December 1, November 26,
2012 2011
----------------------------------------------------------------------------

Cash flows from operating activities
Net income (loss) from continuing operations (722) 1,289
Net loss from discontinued operations (22) -
------------------------------
Net income (loss) $ (744) $ 1,289

Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Amortization 1,524 1,134
Deferred income taxes (15) 5
Income taxes payable 2 (17)
Stock-based compensation 63 63
Impairment of goodwill 335 -
Other 25 17
Net changes in working capital items 903 (634)
------------------------------
Net cash provided by operating activities 2,093 1,857
------------------------------

Cash flows from investing activities
Acquisition of long-term investments (200) (166)
Proceeds on sale or maturity of long-term
investments 180 366
Acquisition of property, plant and equipment (325) (713)
Acquisition of intangible assets (770) (1,178)
Business acquisitions, net of cash acquired (105) (226)
Acquisition of other assets - (779)
Acquisition of short-term investments (837) (137)
Proceeds on sale or maturity of short-term
investments 392 462
------------------------------
Net cash used in investing activities (1,665) (2,371)
------------------------------

Cash flows from financing activities
Issuance of common shares - 9
Tax deficiencies related to stock-based
compensation (10) (2)
Purchase of treasury stock (25) (150)
------------------------------
Net cash used in financing activities (35) (143)
------------------------------
Effect of foreign exchange gain (loss) on cash
and cash equivalents 1 (16)
------------------------------

Net increase (decrease) in cash and cash
equivalents for the period 394 (673)
Cash and cash equivalents, beginning of period 1,516 1,791
------------------------------
Cash and cash equivalents, end of period $ 1,910 $ 1,118
------------------------------
------------------------------

December 1, September 1,
As at 2012 2012
----------------------------------------------------------------------------

Cash and cash equivalents $ 1,910 $ 1,506
Short-term investments 821 554
Long-term investments 207 278
------------------------------
$ 2,938 $ 2,338
------------------------------
------------------------------

Contacts:
Media Contact:
Nick Manning
RIM Media Relations
(519) 597-6612
nmanning@rim.com

Investor Contact:
RIM Investor Relations
(519) 888-7465
investor_relations@rim.com

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