Research In Motion (NASDAQ:RIMM) posted earnings after Street consensus was $3.78 billion in revenue and $1.04 a share. Guidance was for $3.6 billion to $3.85 billion and EPS of $1 to $1.08.

As it turned out Revenue for the third quarter of fiscal 2010 was $3.92 billion, up 11% from $3.53 billion in the previous quarter and up 41% from $2.78 billion in the same quarter of last year. The revenue breakdown for the quarter was about 82% for devices, 14% for service, 2% for software and 2% for other revenue. During the quarter, RIM shipped about 10.1 million devices, including its 75 millionth BlackBerry smartphone. Net income for the quarter was $628.4 million, or $1.10 per share diluted, compared with net income of $475.6 million, or $0.83 per share diluted, in the prior quarter and net income of $396.3 million, or $0.69 per share diluted, in the same quarter last year.

Approximately 4.4 million net new BlackBerry subscriber accounts were added in the quarter. At the end of the quarter, the total BlackBerry subscriber account base was about 36 million.

For the February quarter, the street expectations were for revenue of $4.11 billion and $1.12 a share.

Revenue for the fourth quarter of fiscal 2010 ending February 27, 2010 is expected to be in the range of $4.2-$4.4 billion. Gross margin for Q4 is expected to be about 43.5%. Net subscriber account additions in the fourth quarter are expected to be in the range of 4.4-4.7 million. Earnings per share for the fourth quarter are expected to be in the range of $1.23-$1.31 per share diluted.

RIM is clearly not being hurt by Apple’s (NASDAQ:AAPL) move into the smart phone industry. Together Apple and RIM seem to be taking market share from larger handset companies that have launched high-end products in trying to capture sales for expensive units which presumably have high profit margins.

RIM shares traded up to almost 10% after hours

Douglas A. McIntyre

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