Shares in Research in Motion soared more than 20pc on Wall Street after the troubled maker of the BlackBerry device reported a smaller loss than feared. Analysts say huge hurdles remain before RIM can reestablish itself as a force in the smartphone market Photo: Alamy By Richard Blackden

10:58PM BST 27 Sep 2012

Investors sent shares in RIM racing after a rare piece piece of bright news from the Canadian company that invented the lucrative smartphone market.

Although RIM's $235m (£145m) loss for the three months to the end of August trailed a profit of $329m in the same quarter last year, it was a better result than Wall Street had forecast.

Sentiment towards the embattled company was buoyed further because RIM's cash pile climbed to $2.3bn from $2.2bn a quarter earlier. Analysts said the increase allays fears that the BlackBerry maker could run out of cash before the launch of its new phone early next year.

"It's still bad, but it's a much smaller disaster than expected," said Shaw Wu, an analyst at stockbroker Sterne Agee. "These stocks all trade on expectations. Expectations were really low, and they were able to beat that."

RIM's chief executive Thorsten Heins is betting that its next phone, which will be based on a new operating system called BB10, will be enough to win back market share from Apple and Samsung in the critical US market. While the Canadian company is managing to lift sales in India, South Africa and Indonesia, the prices it can charge there are lower than in more developed economies.

Despite the surge in the shares in late trading in New York, analysts say huge hurdles remain before RIM can reestablish itself as a force in the smartphone market. Its global market share fell below 5pc last quarter, according to research firm IDC. That compares with the 12pc share it enjoyed a year earlier.

Shares in RIM climbed as high as $8.90 in late trading.
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