RIM's Inventory Surges Past $1 Billion, Faces Threat of Yet Another Writedown
It's no secret that RIM, the maker of Blackberry smartphones and Playbook tablets, are in a bit of fix. Faced with keen competition from the likes of the iPhone and an ever increasing number of various Android smartphones, the company has seen its sales and profits tumble drastically.
Because of declining sales, Bloomberg reported that RIM saw the value of its in-house supplies grow by 18% in the last quarter. Apple, in comparison, saw the value of its inventory drop by 11% thanks to brisk sales.
And since Blackberry is slated to announce a new lineup of phones that will run on the company's new Blackberry 10 OS, it is likely that the existing models will become even more unpopular. This means that RIM will likely have to take a writedown to account for its inventory's declining value.
Earlier last Decemember, RIM took a US$485 million pretax writedown on the value of its Playbook inventory and followed up with a subsequent US$267 million writedown on its Blackberry inventory. It is estimated that the total value of the company's inventory is now a whopping US$1.03 billion, up from $618 million just a year ago.