“BlackBerry adoption continues to be strong in light of tough macroeconomic headwinds,” said Shaw Wu, an analyst at Kaufman Bros LP in San Francisco, who rates the stock “hold.”
That shows the appeal of RIM’s e-mail technology, he said.
Sales in the three months through February jumped 84 percent from a year earlier, bolstered by premium models like the Storm and the Bold. Those should help fatten margins as the relative costs of developing and introducing those phones shrinks, Balsillie said.
Keeping profit margins high will be difficult given how fickle consumers constantly expect new devices, said Jonathan Goldberg, an analyst at Deutsche Bank Securities Inc.
“To keep consumers upgrading they have to stay on the Hit Parade or innovation treadmill indefinitely and that may prove to be beyond RIM’s abilities,” he said. “We see these issues creating margin pressure over time.”
San Francisco-based Goldberg rates the stock “hold.”
RIM expects to generate more cash through App World, which opened last week, and now offers about 1,000 programs. Application developers get 80 percent of the royalty from every download, while RIM will split the remaining 20 percent with its carrier partners.
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