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44
RESEARCH IN MOTION LIMITED
management’s discussion and analysis of financial
condition and results of operations continued
FOR THE THREE MONTHS AND FISCAL YEAR ENDED MARCH 3, 2007
Fiscal Year Ended
March 4, 2006 February 26, 2005
(as previously reported)
$% of
Revenue $
% of
Revenue
Revenue $ 2,065,845 $ 1,350,447
Research and development $ 157,629 7.6% $ 101,180 7.5%
Selling, marketing and administration 311,420 15.1% 190,730 14.1%
Amortization 49,951 2.4% 35,941 2.7%
$ 519,000 25.1% $ 327,851 24.3%
Fiscal Year Ended
March 4, 2006 February 26, 2005
(restatement)
$% of
Revenue $
% of
Revenue
Revenue $ - $ -
Research and development $ 1,258 0.1% $ 1,485 0.1%
Selling, marketing and administration 2,897 0.1% 3,108 0.3%
Amortization - - - -
$ 4,155 0.2% $ 4,593 0.4%
Fiscal Year Ended
March 4, 2006 February 26, 2005
(as restated)
$% of
Revenue $
% of
Revenue
Revenue $ 2,065,845 $ 1,350,447
Research and development $ 158,887 7.7% $ 102,665 7.6%
Selling, marketing and administration 314,317 15.2% 193,838 14.4%
Amortization 49,951 2.4% 35,941 2.7%
$ 523,155 25.3% $ 332,444 24.7%
Research and Development
Research and development expenditures increased by
$56.2 million to $158.9 million, or 7.7% of revenue, in fiscal
2006 compared to $102.7 million, or 7.6% of revenue, in the
previous year. The majority of the increases during fiscal
2006, compared to fiscal 2005, were attributable to salaries
and benefits (primarily as a result of increased personnel
to accommodate the Company’s growth), third party new
product development costs, travel, recruiting, and materials,
certification and tooling expenses.
Selling, Marketing and Administration
Selling, marketing and administrative expenses increased by
$120.5 million to $314.3 million for fiscal 2006 compared to
$193.8 million for fiscal 2005. As a percentage of revenue,
selling, marketing and administrative expenses increased to
15.2% in fiscal 2006 compared to 14.4% in fiscal 2005.
The net increase of $120.5 million in selling, marketing
and administrative expenses was primarily attributable
to increased expenditures for marketing, advertising and
promotion expenses, compensation expense as well as
increases in consulting and external advisory costs. Other
increases were attributable to recruiting, travel and legal fees.