Research In Motion Q3 2011 $485M Provision Related To PlayBook Inventory - Misses 2011 Guidance

December 2, 2011

Research In Motion Limited will record a pre-tax provision in the third quarter of fiscal 2012 of approximately $485 million, $360 million after tax, related to its inventory valuation of BlackBerry PlayBook tablets. The charge is expected to be predominantly non-cash. All figures in this release are in U.S. Dollars and U.S. GAAP, except where otherwise indicated.

As previously disclosed, RIM has a high level of BlackBerry PlayBook inventory. The Company now believes that an increase in promotional activity is required to drive sell-through to end customers. This is due to several factors, including recent shifts in the competitive dynamics of the tablet market and a delay in the release of the PlayBook OS 2.0 software. As a result, RIM will record a provision that reflects the current market environment and allows it to expand upon the aggressive level of promotional activity recently employed by the Company in order to drive PlayBook adoption around the world.

Based on the positive response to the promotions that are underway in select markets, RIM believes this strategy will accelerate adoption of its QNX-based platform by consumers and enterprises, as well as help to drive the development of a vibrant application ecosystem in advance of its next generation BlackBerry smartphones. RIM sold into the channels approximately 150,000 BlackBerry PlayBook tablets in the third quarter and sell-through to end customers, based on RIM’s internal data, was higher than this amount. Since the launch of the new promotions across consumer and enterprise channels in the United States and Canada late in the third quarter, the Company has seen a significant increase in demand for the PlayBook. Both consumer and enterprise customers who purchase a new BlackBerry PlayBook at the current promotional pricing, along with existing PlayBook customers, will be able to upgrade to the enhanced PlayBook OS 2.0 software at no additional charge when it becomes available in February 2012.

“RIM is committed to the BlackBerry PlayBook and believes the tablet market is still in its infancy. Although a number of factors have led to the need for an inventory provision in the third quarter, we believe the PlayBook, which will be further enhanced with the upcoming PlayBook OS 2.0 software, is a compelling tablet for consumers that also offers unique security and manageability features for the enterprise,” said Mike Lazaridis, Co-CEO at Research In Motion. “Early results from recent PlayBook promotions indicate a significant increase in demand across most channels. We look forward to continuing to grow the installed base of PlayBook users and to attracting more and more developers to expand the volume of applications, content and services that leverage the power of the industry leading QNX-based platform.”

Updated Third Quarter Fiscal 2012 Guidance and Outlook

While the Company is still in the process of finalizing its third quarter financial results, the Company shipped approximately 14.1 million BlackBerry smartphones in the third quarter ended November 26, 2011 which was in line with previous guidance of between 13.5-14.5 million. Adjusted revenue in the third quarter, excluding a charge against revenue of approximately $50 million related to the service outage that occurred in the quarter, is expected to be slightly lower than the previously guided range of $5.3-5.6 billion, reflecting product mix and the impact of PlayBook sell-through programs in the quarter. Gross margin is expected to be in line with previous guidance of approximately 37%. Excluding the PlayBook provision and the outage related impact described above, RIM expects adjusted diluted earnings per share in the third quarter to be at the low to mid point of the $1.20-$1.40 per share range it previously guided. The Company’s cash balance at the end of the quarter increased by approximately $80 million to approximately $1.5 billion. The Company is still in the process of finalizing its fourth quarter outlook, and based on preliminary estimates, RIM expects unit shipments in the fourth quarter to be below third quarter levels. The lower expected shipments in the fourth quarter are due to several factors including lower than expected sell-through in the third quarter and RIM’s current view of fourth quarter demand. The Company no longer expects to meet its full year adjusted diluted earnings per share guidance of $5.25-6.00.