Blackberry 2006 Annual Report Download - page 25
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Research In Motion Limited • Incorporated Under the Laws of Ontario (In thousands of United States dollars, except per share data, and except as otherwise indicated)
Annual Report 2006 23
For the years ended March 4, 2006, February 26, 2005 and February 28, 2004
Results of Operations
The scal year ended March 4, 2006 comprised 53 weeks compared to 52 weeks for the scal year ended
February 26, 2005.
Revenue
Revenue for scal 2006 was $2.07 billion, an increase of $715.4 million, or 53.0%, from $1.35 billion in the
preceding scal year.
A comparative breakdown of the signicant revenue streams is set forth in the following table:
Fiscal 2005
Number of devices sold 2,444,000
ASP $ 382
Devices $ 933,989 69.2%
Service 235,015 17.4%
Software 131,8 1 1 9.8%
Other 49,632 3.6%
$ 1,350,447 100.0%
Device revenue increased by $505.7 million, or 54.1%, to $1.44 billion, or 69.7% of consolidated revenue in
scal 2006 compared to $934.0 million, or 69.2% of consolidated revenues, in scal 2005. This increase in
device revenue over the prior scal year is primarily attributable to a volume increase of 65.4%, or 1.60
million units, to approximately 4.04 million units from approximately 2.44 million units in the prior year,
partially offset by a decrease in ASP. The Company has launched a number of new products in the current
scal year and now has devices operating on the GPRS, iDEN, EDGE, CDMA and Ev-DO wireless networks
and expanded its customer base of carrier customers, which account for the volume growth. ASP
decreased 6.8%, or $26, in scal 2006 to $356 per unit from $382 per unit in scal 2005, primarily as a
result of overall device mix. The Company expects its ASP for devices to remain relatively steady in the
rst quarter of scal 2007 based on projected future sales volumes and product mix, offset in part, by a
continued drive to expand the Company’s prosumer offering as well as increased competition in the industry.
The Company believes revenue and subscriber account additions were adversely affected in the latter part
of scal 2006 as a result of certain customers delaying purchases due to the uncertainty created by the
NTP litigation.
The Company estimates that a $10 change in ASP would result in an annual revenue change of
approximately $40 million, based upon the Company’s volume of handhelds shipped in scal 2006.
Service revenue increased $148.0 million, or 63.0%, to $383.0 million and comprised 18.5% of consolidated
revenue in scal 2006 compared to $235.0 million, or 17.4% of consolidated revenue, in scal 2005. This also
reects the impact of the 53 week scal year in scal 2006 compared to the 52 week year in scal 2005.
BlackBerry subscriber account additions were approximately 2.3 million in scal 2006, or a 93.1% increase
on the total subscriber base compared to approximately 1.44 million subscriber additions in scal 2005.
The total base of BlackBerry subscriber accounts at the end of scal 2006 was approximately 4.9 million.
Devices
Service
Software
Other
Devices
Service
Software
Other