Research In Motion, the maker of the BlackBerry smartphone, may be in danger of being left behind in the technology race.
Shares in the company dropped to their lowest level since 2006 after first-quarter results were lower than expected and the company unveiled plans to reduce jobs.
RIM shares plummeted 21.5 per cent to US$27.24 on the New York Stock Exchange on Friday, its busiest day of trading in almost six years. The company's shares have fallen hard since it issued a profit warning in April, blaming slower than expected demand for its smartphones.
Net profit fell 9.6 per cent to $695 million in the first quarter ending May 28, compared with the same period last year.
Although first-quarter revenues rose 16 per cent to $4.91 billion, the outlook for the second quarter is grim.
Jim Balsillie, the co-chief executive at RIM, said the fiscal year had "gotten off to a challenging start".
"The slowdown we saw in the first quarter is continuing and delays in new product introductions into the very late part of August are leading to a lower than expected outlook in the second quarter," he said.
Revenue for the second quarter ending on August 27 is expected to be between $4.2bn and $4.8bn.
RIM is losing market share in the US to Apple's iPhone and handsets running Google's Android software, in part because it has failed to introduce a major new BlackBerry model since last August. Cheaper Google phones are also making inroads in Latin America, Asia and Europe, threatening the popularity of BlackBerry models such as the Curve.
"Having seen a lot of other competing smartphones in the market, BlackBerry is not doing enough to introduce new innovative products, unlike Nokia, Samsung and Apple," said Sally Gerges, a telecommunications analyst at Beltone Financial in Cairo.
Question marks also persist over the availability of the BlackBerry service in the UAE because of security concerns.