Good afternoon, ladies and gentlemen. Thank you for standing by. Welcome to the Research In Motion second quarter fiscal 2009 results conference call. (Operator Instructions) I will now turn the conference over to Ms. Edel Ebbs, Vice President of Investor Relations. Please go ahead.

Thank you, Operator. Welcome to RIM's fiscal 2009 second quarter results conference call. I’m Edel Ebbs, RIM's Vice President of Investor Relations. With me on the call today is Jim Balsillie, RIM's Co-CEO, and Brian Bidulka, RIM's Chief Accounting Officer. After I read the required forward-looking statements disclaimer, Jim will provide a business and strategic update. Brian will then review second quarter results and I will discuss our outlook for the third quarter of fiscal 2009. We will then open the call up for questions. I would like to note that this call is available to the general public via call-in number and webcast. A replay of the webcast will also be available on the rim.com website. We plan to wrap up the call today before 6:00 p.m. Eastern this evening. Some of the statements we will be making today constitute forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws. These include statements about our expectations and estimates with respect to revenue, gross margin, operating expenses, CapEx, depreciation and amortization, investment income, earnings, earnings per share, channel inventory, seasonality, and ASPs for Q3 and beyond; our expectations regarding RIM's near and long-term tax rates; our estimates of the number of BlackBerry subscriber accounts, subscriber account additions, replacement device sales, prepaid plans and other non-financial estimates; our product development initiatives and timing; developments relating to our carrier partners; new and expanding markets for our products, and other statements regarding our plans and objectives. We will indicate forward-looking statements by using words such as expect, anticipate, estimate, may, will, should, forecast, intend, believe, continue, and similar expressions. All forward-looking statements reflect our current views with respect to future events and are subject to risks and uncertainties and assumptions we have…

Thank you, Edel. We are pleased with our second quarter performance with revenues of $2.58 billion, up 88% from the prior year and earnings of $0.86 per share, up from $0.50 per share the same quarter last year. It’s been a busy summer at RIM with a few new product launches -- with a number of new product launches and announcements, as well a several new relationships with companies such as AOL, Microsoft, MySpace, Slacker, TicketMaster, and Tivo. We added approximately 2.5 million net new subscriber accounts in the second quarter and the total BlackBerry subscriber account based was approximately 19 million at the end of Q2. Approximately 60% of the net additions in the quarter were by non-enterprise customers, and approximately 42% of our subscriber account base are now non-enterprise users. We continue to add carrier and distribution partners around the world and we now have approximately 400 carrier distribution partners offering BlackBerry in over 150 countries around the world. The percentage of our subscriber base outside North America remains steady in Q2 in the low 30% range. The BlackBerry Bold was launched by 60 carriers in 29 countries this quarter and there is a strong take-up of the product by both enterprise and consumer customers. In fact, the mix of Bolds being activated in the market is split roughly in half between enterprise and non-enterprise segments. In the initial days of these Bold launches, we saw a disproportionate amount of Bolds being activated as upgrades or replacements. However, the mix between upgrades and new customers is beginning to shift now that the product has been marketed for a few weeks. This is consistent with our past experience with other query devices, such as the Curve and the 8800. In markets where it is launched, product reviews of the…

Thank you, Jim. Revenue for the second quarter ended August 30th was $2.58 billion, up 15% from $2.24 billion in the previous quarter. Handheld devices represented $2.12 billion, or 82% of RIM's revenue during the quarter, in line with the previous quarter. Total devices shipped in the quarter of approximately 6.1 million were up from 5.4 million in the prior quarter. Approximately 4.8 million new devices were activated in Q2, either for new customers or for replacements and upgrades, not including phone only sales. Channel inventory at the end of Q2 was up slightly from Q1. Device ASPs in the quarter were approximately $344. We expect ASPs in Q3 to be approximately the same as in Q2. Service revenue was $334 million, or 13% of revenue for the quarter, up $42 million from Q1. Monthly ARPU declined just slightly from the prior quarter. Software revenue was $64 million, or 3% of revenue. Other revenue, including non-warranty repairs and accessories, was $63 million, or 2% of revenue. Gross margin for the second quarter was 50.7%, in line with our expectations. Operating expenses increased by 23%, slightly less than we had forecast last quarter. R&D spending was $181 million, or 7% of revenue for the quarter, and selling, marketing, and administrative expenses increased to $380 million, and were 15% of revenue. Included in operating expenses is stock option expense of approximately $10 million. The tax rate for the quarter was approximately 31.1%, slightly higher than our forecast, primarily due to the unfavorable impact of the appreciation of the U.S. dollar relative to the Canadian dollar. The impact of the unfavorable tax rate was just over $0.01 per share and was primarily the result of U.S. dollar denominated assets and liabilities held by our Canadian operating companies that are subject to tax in…

Thanks, Brian. Just before I move on to guidance, I just want to clarify that the net subscriber account additions in the quarter were 2.6 million. Before I discuss our outlook for Q3, I would like to remind everyone that these forward-looking statements reflect management’s best current estimate and should be taken in the context of the risk factors listed at the beginning of the call and outlined in our public filings. We are forecasting revenue for the third quarter of fiscal 2009 to be significantly higher than Q2 in the range of $2.95 billion to $3.1 billion. We expect hardware shipments to be over 7 million units at a similar ASP to the second quarter. The number of product launches that were scheduled for early Q3 are now scheduled to occur later in the quarter than we anticipated at the time of the last earnings call and the ramp in these products is now expected to straddle Q3 and Q4. Our forecast for Q3 includes a number of new products, including Bold, the Pearl flip, as well as smaller quantities of an unannounced product on a new platform that is expected to ship later in the quarter. The slip in the timing of these launches beyond our expectations, in particular the BlackBerry Bold and the BlackBerry Pearl flip launches in the U.S., could impact the actual results we report for the third quarter and shift unit shipments from Q3 to Q4. We anticipate that forward weeks of channel inventory at the end of the third quarter will be similar to Q2. Software revenue in Q3 is expected to increase slightly. We are targeting net subscriber account additions for Q3 of approximately 2.9 million. This increase is expected to be driven by back-to-school promotions that have been happening in September,…

Thank you, Edel and thank you, Brian. We believe we are entering a time of tremendous opportunity for our business and are targeting strong revenue and earnings growth for the remainder of the fiscal year. The BlackBerry product portfolio we have in market, together with the growth in brand awareness and carrier support of the past several quarters, put RIM in an excellent position to continue to gain share in the global smartphone market. We look forward to updating you on our progress again in December. This concludes our formal comments. Due to the large number of people on the call, we ask that you please limit yourself to one question per person. We plan to end the call today by approximately 6:00 p.m. Would the operator please come on to handle questions?

(Operator Instructions) Your first question comes from Maynard Um from UBS.

It sounds like this past quarter and the current quarter is very promotion heavy around back-to-school and other carrier promotions, which I presume is the thing that is also helping the top line. And it sounds like beyond that, you expect greater revenue ramps in Q4, helping your leverage and the leverage in the model but I guess the question is beyond the third quarter, looking into the fourth quarter, why wouldn’t we expect to see some seasonality to start kick in and beyond that, as some of this promotional activity starts to tail off, which looks like is being the key driver over this past quarter and the November quarter?

Well, it’s a fair question. What’s really happening -- I mean, there’s a number of currents at play in the market right now which are very, very exciting. You know, we -- if you’ll remember, when we have the conference call last year, we really had a surge during the Black Friday and we weren’t really sure what was going to happen and there was a pretty -- there was a very strong flow into the new year, calendar new year throughout Q4, so that was pleasant and one could reasonably expect that if all these hero programs take the traction we think we are going to have, and we have a dramatic and comprehensive set of hero programs really throughout North America and Western Europe but that should carry through. So when you talk of seasonality, is that something for the spring or something like that, it’s getting a little out of our visibility because it’s very important to remember that there’s a lot of sector-specific stuff at play right now where the smartphone is really displacing the common cell phone and so we’ve got a lot of sector-specific trends that really are key drivers with all these new enablers we talked about. So our view of it is it’s really a time for adoption. The new products traditionally have a higher BOM and you work it down. We’ve just got such a rapid product cycle. You’ve seen part of the announcement this -- at CTIA a couple of weeks ago and you haven’t heard all of the announcements and all of these are coming in mid-quarter, so small shifts in a couple of weeks here or there really shift how much comes into the quarter. And definitely being a hero campaign for the holiday season is very unique for us and we participate in some of the pricing and the promotion in this but as I said before, there’s also ways to get the cost down and we see some very exciting new high margin revenue strategies that come out of all of this, so it’s exciting, it’s dynamic, it’s high growth, we’re the leading market share player, we’re investing hard in product innovation and platform innovation and hardware innovation and channel execution and new ecosystem development and beyond that, the nuancing of bits of tweaks in the model in seasonality is a bit hard to predict but it’s not really where our head is. Our head is just driving this hero campaign and driving the ecosystem adoption in this hot new space and that really tees up something that just sustains and sustains for a long period of time and it definitely comes with some investment on our part in all of that. So it’s very hard to nuance. As I’ve said, the sector-specific stuff is more dramatic force in our business than sort of macroeconomic stuff, so a bit of seasonality, sure, but you are really subject to the sector-specific drivers.

Can you just clarify on the gross margin the impact of the COGS of the hardware versus any contra revenue marketing that you are doing?

It’s probably a 50-50. It’s a fair comment. You know, there’s some high BOM on it but we really just pack it full of features and then you cost reduce later but we’ve never introduced so much new product so fast. And for sure, you do some contra stuff to get the hero campaign because this is cutting over to a mass play and like I said, we are a platform play and there are a lot of new revenue streams that are teeing up on this and we are the market share leader and this is the future and you gotta extend and drive the adoption with it all the way and the models aren’t static and changes on interim basis as we step through transitions and investments and adoptions, we view them as shrewd and very, very beneficial to the long-term interest of the company. But I’d put it down to a 50-50. I’d say some aggressive pricing for a hero campaign with major growth plays and the other is just an overstuffed BOM that takes a little bit of time to cost reduce but you know, [there’s such a high product cycle] and we’re not even near done this autumn. Like, you are going to see even more stuff, so it’s a remarkable time.

Thank you.

Your next question comes from Chris Umiastowski from TD Newcrest.

Thanks very much. I think the gross margin stuff is going to get asked to death so I want to ask something a little bit different -- can you guys talk about your expectation for having phones like the Pearl flip hit the prepaid market? But I’m talking about the prepaid voice market, not so much prepaid BlackBerry. It seems to me that in Europe in particular, and probably globally this is a trend towards more of a pay-as-you-go on a voice basis and I don’t really see a lot of carriers offering BlackBerry data on a prepaid voice SIM card and I’m wondering whether you think that’s going to start to change and how important that might be.

Well that’s happened a fair bit and T-Mobile has done that, first of all, as a voice only. It won’t be hard to get into a pay-as-you-go. What’s also interesting is we are working on prepaid plans for data, so all the different channel programs and channel promotions -- you know, I think the key thing for the carriers really is that as the voice comes under pressure and commoditizes a bit, [and number] portability and VOIP things and all that kind of stuff, the most important thing for the carrier is to create a platform relationship with data services to their customers so getting sort of a pay-as-you-go voice plan isn't that strategic because BlackBerry represents a very profitable play for them, so it’s much more about -- but you know, what’s interesting to me is that I think pretty soon all phones will be smartphones. It’s a function of just a little bit of software and some memory and a little bit of audio and a bit of a platform structure in it and so will all these phones be sold as latent smartphones? Yes. And will there be data activated? It may be just they are latent to use as you wish and there will be creative revenue models and that kind of stuff, so that seems very, very intriguing to me, as well as them selling voice only plans. But we haven’t got a lot into sort of pay-as-you-go voice plans but the more interest has actually been into prepaid data because pay-as-you-go on data -- that’s what you mean, a prepaid thing and we have announced some of those and that’s a big play in a lot of the world. You know, parts of Lat-Am where even the high-end customers, the overwhelming percentage are prepaid and so getting data into a prepaid model is becoming a big, big part of what we are doing but a little less just going in the pay-as-you-go voice segment. That one hasn’t come my way. We have sort of bigger fish to fry on our adoption but that may come out as kind of a channel product planning strategy to carriers but it’s been more the other things I’ve talked about so far.

Okay, and I just also wanted to ask a clarification -- you said ASP would be flat for the quarter coming up but you are expecting to ship a lot of new devices with higher costs, so I was hoping you could reconcile why flat ASP if you are going to be shipping a lot more expensive devices in the quarter?

Sure, Chris. Some of them, there’s also the BlackBerry flip in there, the BlackBerry Pearl flip, which is a fair bit lower ASP and there’s still a good portion because those launches are sort of straddling Q3-Q4, there’s you know, still a good bit of our Curve Pearl 8800 platform in there as well.

Okay. Thanks a lot, guys.

Your next question comes from Gus Papageorgiou from Scotia Capital.

Just on the margins, so if I look at your operating model based on the guidance you are giving, we should see operating margins just kind of below 26% for the next quarter. That’s EBIT margins, which is a number you haven’t seen since kind of Q105. Since that time, you’ve been between kind of 26% to 31%, 32% operating margins. I’m just wondering, going forward for the modeling purposes, do you think you can maintain that 26% to 31%, 32% range operating margin or should we also take down our expectations of operating margins consistent with the gross margin?

I think what we tried to get across on the call is that we think that the big ramp in the OpEx spend is really behind us and now you will just see more normal spend so while the absolute dollars will go up, you will see a normalization in terms of rate, so you will see it go down as a percentage of revenue. I mean, the counteract into that is the decreased gross margins but I think that as you go out into Q4 and next year, if we get the top line growth that we are hoping for, we will be able to drive some leverage. I can’t commit to a level. There’s too many wildcards in there but that’s where the dynamic that we are looking at and we think that we can drive leverage and sell some really good profit growth.

So is it then reasonable to think that you can kind of maintain historic EBIT margins or is that an unrealistic assumption?

I mean, I don’t think that -- I mean, I think that there’s certainly ways that we can get back there.

I think, Gus, in the interim, there’s really -- I mean, this is a heavy adoption cycle. It’s a new product cycle. There’s some pricing and there’s some BOM stuff but you know -- I mean, I think we’ve sort of telegraphed we have some ways that we think we can bring the cost down if we see some new revenue streams. The model, we believe it’s long-term leverage. We believe this high-growth we got -- we got leadership in this and I just can’t telegraph a lot more of it right now but we feel very comfortable about the long-term margin and the long-term opportunities with this.

Okay. Thank you.

Your next question comes from Jeffery Kvaal from Barclay’s Capital. Jeffery Kvaal - Barclay’s Capital: Indeed. Jim, my question is -- I’m wondering if there’s a bit of a shift in the competitive or market landscape. It seems as though that in the past, you might have been able to pass along some of the cost of a new platform or in this particular case, there is a little bit more co-marketing that is required in launching a new product, so I’m wondering if the market is softening, is there greater competitive elements to the market now than there might have been a few years ago or how we should think about this?

It’s a fair question, Jeff, and I would say the things that are different here is that’s pretty normal for us when we introduce new products if they got a slightly tighter margin. What’s unique here is we’ve never introduced so much product and brought so much product into the mix at the same time, so that’s kind of point number one. Point number two, we’ve never been put in so many hero campaigns and there’s a little bit of a quid pro quo because they completely put their shoulders -- like, you are going to see hero programs like -- just wait until you see. Like, everyone has a hero campaign where we are the featured if not the only featured device for the buying season. And that transitions us to a totally different league and a totally different set of opportunities that really keeps that sort of smartphone into traditional cell phone displacement cycle and mass marketing thing going on. So if we believe that adoption and positioning is the key, this is the core strategy at this point in time so I wouldn’t put it to a competitive thing. I would put it to a rapid introduction of new products in the cycle, coupled with being positioned as hero. And again, this is a lot of new newness. Like, these are -- like, you know, you are starting to see early, early indications of these campaigns but wait 30 days and when you see these campaigns, it’s like nothing you’ve ever seen before. And part of it is if they are going to put their shoulder into it, we’ve got to put it in a little bit and yes, there’s some interim model shifting but the aggregate margins so great and we are also at an investment…

Yeah, well I think that -- you know, we have a lot of products launching Q3, Q4, and even into early next year and a lot of them are all on the same product platform that have the higher costs that we refer to, so -- I mean, it’s not -- yes, Pearl flip is a little bit different but most of the rest of our products that are coming out over the next few quarters are going to be at that higher cost and we are expecting a lot of volume from those products so you’ll start to see over time --

If you still have that land grab going on, you still have the rapid introduction, you are surging, we’re in a surge type situation right now, you know, it’s hard to have any reasonable visibility beyond a couple of quarters from now. I mean, it just gets more and more opaque very quickly after that but you are going to see a rapid set of product introductions and a rapid adoption of what we do as this thing accelerates. I mean, that to us is unambiguous and as we’ve said, we think we can cost reduce these once it stabilizes and we think we have new revenue streams and the market leverages, and investors have to decide -- do they want that leverage off a small platform base or a large platform base? And strategically running this company, I think it’s all about adoption right now because that’s going to be the basis for phenomenal leverage for a long, long period of time and as you assess this business and get close to it and you see the dynamic that’s at play, there’s a turbo-charging and there’s a massive disruption going on in a very positive way if this is played out well right now and it’s all about catalyzing adoption through this rapid stage of the next couple of quarters. And exactly how the model will settle out, you know, we know there’s leverage, we know there’s new revenue streams, we know there’s cost reduction opportunities and most of all, we know there’s a super-charged top line and we’ve got to be there and if we are there, it’s great and -- but if we give up ground for short-term gratification, that’s just not in the best interest of our shareholders, not even close. Jeffery Kvaal - Barclay’s Capital: Thank you.

Your next question comes from Kulbinder Garcha from Credit Suisse.

Thanks. I hear the comments on gross margin and [inaudible] you are going after. I guess what I am surprised about is why isn't the [inaudible] seasonality even stronger for the next couple of quarters? That’s my first question. The second one is on OpEx, did I hear you correctly saying OpEx still should start basically going down after the next quarter?

Well that’s -- I mean, you know, first of all, I think we are guiding at least 20% growth, around 20% growth this quarter with a fair bit of range. And second of all, a lot of these products are coming in mid-quarter, mid-ish to late quarter so here we’re bringing some in now and so -- and you invest and brand build and co-op right in the start of those things, so I mean, I think you look at the leverage of the model and the cash flow of the company and this hyper growth that we’ve been through chronically and the tremendous pipeline of products and the tremendous platform extensions and I said on the call, we’re now at over 400 carrier partners around the world. I mean, I blink and it was 25 not so long ago and I just came back from India -- remarkable opportunities and investment there. You know, we’re in China with remarkable opportunities to invest. Russia, remarkable ones and surging in Western Europe in the holiday season and North America. So why is it there? Is it -- you know, first of all, I think there is growth, tremendous growth, actually. I mean, 20% give or take whatever the bit is going to be and that’s what’s guided with a lot of new products coming in and a lot of opportunity and a lot of exciting stuff for Q4. A lot of this stuff coming in mid-quarter, heavy investments in all we do and still I think a strong model and strong performance and strong growth and strong cash management and we’re balancing so many things and I think we are balancing them exceptionally. I completely support -- you know, if there was one thing that I would do if I had…

Okay. Thank you.

Your next question comes from Tim Long from Banc of America.

Thank you. If I could just drill a little bit more into the OpEx line -- so it did come in it looks like a little bit better for the August quarter and the guidance seems a little bit better than what probably most people had, so two parts on that -- number one, could you just talk a little bit about is this management because the gross margin line is coming down? So is this a trend here or is this just somewhat to try to make up for spending on the gross margin line? And second, could you talk about if any spending shifts between the OpEx lines and the COGS line, whether it’s some of the promotional activity or anything like that where we are seeing some spending shift from what we would see in OpEx to what we are seeing now in gross margin? Thanks.

On your OpEx question, when we first talked about the ramp in OpEx that we were expecting in terms of -- especially for the branding programs and for the R&D growth, at the time we talked about that not sort of being a growth rate in OpEx that we were going to see going on instantly. And I think what we are seeing now, I mean, I think the message has always been that we were expecting that to normalize and go back to our regular spending patterns in terms of OpEx, where you have higher marketing spend around launches and things like that. And I think that that’s what is happening here, is that we did do the big spend, we’ve got the branding programs going, we’ve got a lot of growth happen in R&D with some of the new facilities we have and now we are just in a position where we can leverage that. You know, we’ve got the new products hitting the market so we are able to leverage it. I think that’s really what you are seeing in terms of the guidance and maybe a little bit what you saw this quarter.

Okay. Would it be safe to assume that -- you mentioned a small amount of units for a new platform in the November quarter. Would it be safe to assume that the marketing dollars associated with that would be in the November quarter, given that it’s starting to shift now as opposed to when it ramps in February?

It’s really going to depend on when it launches and when it goes into market. You know, the product that I’m referring to, it is a small amount in the quarter and it’s really when the marketing spend for that happens is going to be somewhat dependent on when that launch happens. It’s really hard to say on what side that is going to fall.

Okay, but that was similar to what the Bold was last quarter, correct?

Well, I mean, Bold was [part a little bit this last quarter] but I mean, Q3 is really going to be a bigger quarter or Bold.

Okay. Thank you.

There are no more questions at this time. Please continue.

Thank you. Thank you, Operator.

Ladies and gentlemen, this concludes the conference call for today. Thank you for participating. Please disconnect your lines.