Research In Motion has updated the market to inform shareholders that it will record a pre-tax provision in the third quarter of about $485 million due to an inventory valuation.
The valuation is related to the PlayBook tablet, suggesting RIM still has millions of dollars’ worth of gadgets that remain unsold.
“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,” it said in a statement.
In the statement, co-chief executive Mike Lazaridis said that RIM is still committed to the PlayBook and “believes the tablet market is still in its infancy”.
“Early results from recent PlayBook promotions indicate a significant increase in demand across most channels.”
Patrick Stafford is a freelance journalist and a former deputy editor of SmartCompany.
