This article is from the source 'nytimes' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at http://www.nytimes.com/2013/03/29/technology/a-profit-though-slim-for-blackberry.html

The article has changed 5 times. There is an RSS feed of changes available.

Version 3 Version 4
A Profit, Though Slim, for BlackBerry A Surprise Quarterly Profit for BlackBerry
(about 7 hours later)
OTTAWA — BlackBerry reported a surprise profit on Thursday for its latest quarter, when it introduced a new line of phones and new software to revive its once-dominant cellphone brand. But it still recorded a net loss of $646 million for entire fiscal year. OTTAWA — BlackBerry reported on Thursday a surprise profit for its latest quarter, when it introduced a line of phones and software to revive its once-dominant cellphone brand. But the company still recorded a net loss of $646 million for the fiscal year.
The annual loss, which tax benefits reduced from an operating loss of $1.2 billion, compared with $1.16 billion in net earnings a year earlier. The financial report provided a mix of positive and worrying news, leaving some analysts without a clear picture of the once powerful, but now struggling, company’s long-term future.
In the latest quarter, which ended March 2, the company lost $18 million from operations. But recovery of income taxes transformed that into a $98 million profit for the quarter, or 19 cents a share. “It is encouraging that they’ve stabilized the company and they’re not bleeding to death,” said Edward Snyder, an analyst with Charter Equity Research. “But they still have a long ways to go.”
BlackBerry has struggled with declining sales. Revenue in the latest quarter was $2.6 billion, compared with $2.7 billion in the same period a year ago. Annual revenue fell to $11 billion, from $18.4 billion a year earlier. The annual loss, which was reduced from an operating loss of $1.2 billion because of tax benefits, compared with net earnings of $1.16 billion a year earlier.
For about one month of the quarter, the first of its new phones, the BlackBerry Z10, was on sale in Canada, Britain and some other markets, but not the United States. BlackBerry said that it shipped about a million of the handsets during that time. In the latest quarter, the fourth of the 2013 fiscal year, which ended March 2, the company lost $18 million from operations. But the recovery of income taxes transformed that into a profit of $98 million, or 19 cents a share.
It nevertheless reported that there were 76 million BlackBerry subscribers worldwide at the end of the period, a loss of about three million users. Until the third quarter of the fiscal year, BlackBerry, formerly known as Research in Motion, had consistently increased the number of subscribers. BlackBerry has struggled with declining sales, and that trend continued. Revenue in the latest quarter was $2.67 billion, compared with $2.72 billion in the same period a year ago. Annual revenue fell to $11 billion, from $18.4 billion a year earlier.
In an unanticipated move, the company announced that Mike Lazaridis, one of its co-founders, would cut all formal ties to BlackBerry in May. Along with Jim Balsillie, Mr. Lazaridis stepped down as co-chairman and co-chief executive in January 2012. Although Mr. Balsillie left shortly afterward, Mr. Lazaridis remained on BlackBerry’s board as vice chairman. For about one month of the quarter, the first of the company’s new phones, the BlackBerry Z10, was on sale in Canada, Britain and some other markets, but not the United States. BlackBerry said that it shipped about a million of the handsets during that time, which was in line with several analysts’ estimates.
Last week, he announced plans to start an investment fund focused on companies working on computers based on principles from quantum physics. “It has not been easy, but the BlackBerry team is delivering,” Thorsten Heins, the chief executive, told analysts in a conference call.
“With the launch of BlackBerry 10, I believe I have fulfilled my commitment to the board,” Mr. Lazaridis said in a statement. In contrast with many new handsets from other companies, however, the BlackBerry Z10 has been far from a sellout.
AT&T became the first American carrier to offer the new phone last week. But visits to several wireless stores on Wednesday found striking differences in sales support for the phone that BlackBerry hopes will revive its much diminished fortunes. Mr. Heins said that since its introduction, only about two-thirds to three-quarters of the touch-screen-based Z10s that were shipped were ultimately sold at retail.
At several locations, including an AT&T store on Fifth Avenue in New York and another near Union Square in San Francisco, the Z10 was lumped in with other phones, some two years old, while signs and promotional material were absent. But at an AT&T store in New York’s busy Union Square, the Z10 was heavily promoted. A salesperson there who identified himself as a BlackBerry specialist gave a deep demonstration of the device, including its ability to switch between corporate and personal apps. Shaw Wu, an analyst with Sterne Agee, said the sales data suggested that “The BlackBerry Z10 is not firing on all cylinders.”
The unevenness of presentation was also apparent at T-Mobile USA stores, which this week began selling the Z10, as well as the Apple iPhone 5 and Samsung Galaxy S 4, for $100 down and 24 monthly payments of $20. Verizon Wireless, which has a long association with BlackBerry, was to begin selling the Z10 on Thursday. He said the slower sales may have been a result of current BlackBerry owners awaiting the release in April of the Q10, another high-end phone with a touch screen and a physical keyboard — the keyboard long being a hallmark of the brand.
Brian X. Chen contributed reporting from New York and Quentin Hardy from San Francisco. Mr. Heins said that another new phone using the BlackBerry 10 operating system, with a lower price than the Z10 and Q10, would be released this year. For AT&T subscribers in the United States, the Z10 costs $200 with a two-year contract or $550 without a contract.
BlackBerry reported having 76 million subscribers worldwide at the end of the period, a loss of about three million. Until the third quarter of the fiscal year, BlackBerry had consistently gained subscribers.
In an unanticipated move, the company also announced that Mike Lazaridis, one of its co-founders, would retire and cut all formal ties to BlackBerry in May.
In an interview, Mr. Lazaridis said that the company’s directors initially opposed his proposal in January 2012 that he and Jim Balsillie step down as co-chairmen and co-chief executives in favor of Mr. Heins as the top executive. The two men were widely criticized at the time for not responding more rapidly to competition from Apple’s iPhone and phones using Google’s Android operating system.
Mr. Lazaridis said he agreed to remain vice chairman until the introduction of BlackBerry 10. Mr. Lazaridis said that in the last year, he guided BlackBerry on the product introduction, and helped Mr. Heins with longer-term plans.
“Having fulfilled the commitment I made, it’s time to move onto my next adventure,” Mr. Lazaridis said. Last week, he announced plans to start an investment fund focused on companies working on computers based on principles from quantum physics.
Mr. Heins said that he expected BlackBerry, formerly Research in Motion, to break even in the current quarter despite doubling its spending on marketing to promote the Z10.
AT&T became the first American carrier to offer the new phone last week. But visits to several wireless stores on Wednesday found striking differences in sales support for the product that BlackBerry, which is based in Waterloo, Ontario, hopes will revive its diminished fortunes.
At several locations, including an AT&T store on Fifth Avenue in New York and another near Union Square in San Francisco, the Z10 was lumped in with other phones, some two years old, while signs and promotional material were absent. But at an AT&T store in New York’s busy Union Square, the Z10 was heavily promoted. A salesman who identified himself as a BlackBerry specialist gave a thorough demonstration of the device, including its ability to switch between corporate and personal apps.
The unevenness of presentation was also apparent at T-Mobile USA stores, which this week began selling the Z10, as well as the Apple iPhone 5 and Samsung Galaxy S 4, for $100 down and 24 monthly payments of $20. Verizon Wireless, which has a long association with BlackBerry, began selling the Z10 on Thursday and prominently featured the device on its home page.

Brian X. Chen contributed reporting from New York and Quentin Hardy from San Francisco.