Blackberry 1998 Annual Report Download - page 4

Letter to
Shareholders
2
These accomplishments were instrumental in
nearly tripling RIM’s revenues to $33.2 million during
the year. This rapid rate of growth is expected to
persist as we continue to fill backlogged orders for our
leading-edge two-way pagers, radio modems and PC
cards. RIM’s order backlog stood at $100 million at our
February 28, 1998 year end.
We also exceeded our earnings expectations in
fiscal 1998, with net income of $540,000 versus the
$44,000 earned last year.
RIM’s growth is largely being driven by the
dynamic nature of the emerging mobile personal
communications market in which we operate. But it is
also being propelled by the dedication and determi-
nation of our people, including a management team
committed to a strategic approach to growth. RIM
is a world leader in designing, manufacturing and
marketing wireless consumer and business-to-business
electronic access technology.
At the time of our initial public offering in October
of 1997, we articulated five core strategies through
which RIM intends to deliver a promising future to
our stakeholders. These were and continue to be:
extending our technological leadership; maintaining
market leadership and customer growth; developing
and strengthening strategic alliances with industry
leaders; expanding and improving our production
facilities; and investing in highly qualified people.
In fiscal 1998, we demonstrated our commitment
to these core strategies by putting our energy and
resources behind every one of them.
Extending our technological leadership
We spent a record $6.5 million on research and
development in fiscal 1998 – a 45% increase over the
previous year. Moreover, this figure does not include
the millions of dollars invested by our technology
partners, such as Intel Corporation and Analog
Devices,with whom we jointly develop custom
silicon.
Of course, successful R&D is dependent on the
efforts and ingenuity of talented people. We dedicated
substantial resources to attract many highly skilled
engineers in the specialized areas of radio frequency
engineering, software development, firmware
development, ASIC development, and CAD design
during 1998. It would be difficult to overstate the
importance of these new additions to the future
of RIM.
Thanks to the hard work of our R&D team, our
technology efforts in 1998 were well rewarded. In
addition to the development and market launch of our
two-way pagers and wireless personal computer card
adapters, we reached major milestones in silicon chip
integration and the $9.4 million Techfund project,
which is 50% funded by the Ontario government, for
the development of next generation radio modem
technology.
One indicator of the success of technological or any
other leadership is the degree to which that leadership
is recognized by peers. In this regard, we are proud to
say RIM added to a long list of product and techno-
logy accolades during the past year. For example,
we received the National Quality Institute’s Canada
Award for Excellence Trophy for Innovation for our
Wireless PC Card, and our Inter@ctive Pager was
named Top Product for 1997 in the category of
“Innovative Devices: Voice and/or Data” by Wireless
for the Corporate User magazine.
Perhaps it will be of even greater interest to our
stakeholders to know that RIM’s technological
leadership was affirmed by the most important
indicator of all: our success in product sales.
LETTER TO SHAREHOLDERS
Fiscal 1998 was a year of many achievements for Research In Motion. Not only did we successfully complete our first public
offering, we made important strides in cementing several strategic relationships and firmly established our technological
leadership with the launch of the Inter@ctive Pager, the Wireless PC Card and a number of new OEM radio products.
Other highlights included initial customer orders for our OEM radios, several product awards, and the expansion and
upgrading of our production facilities to meet the growing demand for RIM’s products.