MORE REALITY: Large RIM (RIMM) Manufacturer Says 'Adieu!'
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Research In Motion (Nasdaq: RIMM) shares are lower in early trading Monday following an announcement from Celestica (NYSE: CLS) the company plans to cease manufacturing for RIM.
The long-time supplier said it sees restructuring charges not exceeding $35 million.
News comes as RIM has admitted to losing global smartphone market share over the last few years. Consumer tastes have shifted from business-friendly devices into multi-purpose smartphones. Monday's announcement is another dose of reality for RIM, which has seen shares slump from a peak near $140 in 2007 to just above $10 in recent weeks.
Celestica is likely to see business pressure moving forward. As of its latest quarterly report, Celestica said RIM accounted for 19 percent of its total revenue. Though the number was down from 21 percent the prior year, the loss will be a tough one to make up.
RIM shares are down about 1.7 percent while shares of Celestica are down just about 0.2 percent ahead of the bell.
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The long-time supplier said it sees restructuring charges not exceeding $35 million.
News comes as RIM has admitted to losing global smartphone market share over the last few years. Consumer tastes have shifted from business-friendly devices into multi-purpose smartphones. Monday's announcement is another dose of reality for RIM, which has seen shares slump from a peak near $140 in 2007 to just above $10 in recent weeks.
Celestica is likely to see business pressure moving forward. As of its latest quarterly report, Celestica said RIM accounted for 19 percent of its total revenue. Though the number was down from 21 percent the prior year, the loss will be a tough one to make up.
RIM shares are down about 1.7 percent while shares of Celestica are down just about 0.2 percent ahead of the bell.
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