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BlackBerry steadies losses but admits it sold just 8.5m handsets last year 'Crackberry' days over as BlackBerry handset sales fall to just 8.5m
(about 3 hours later)
The collapse of the BlackBerry from the “crackberry” device that business executives and political leaders could not live without to an almost forgotten handset was highlighted on Friday when the company revealed it sold just 8.5m handsets last year – compared to more than 50m four years ago.The collapse of the BlackBerry from the “crackberry” device that business executives and political leaders could not live without to an almost forgotten handset was highlighted on Friday when the company revealed it sold just 8.5m handsets last year – compared to more than 50m four years ago.
The Canadian company, which has fallen into decline after failing to keep up with innovation from Apple and other smartphone makers, sold just 1.6m Blackberrys in the last three months of its financial year. That is less than half the number it sold in the same period last year, and compares to Apple selling 74.4m iPhones in its latest quarter.The Canadian company, which has fallen into decline after failing to keep up with innovation from Apple and other smartphone makers, sold just 1.6m Blackberrys in the last three months of its financial year. That is less than half the number it sold in the same period last year, and compares to Apple selling 74.4m iPhones in its latest quarter.
BlackBerry, which changed its name from Research in Motion (RIM) in 2013, reported annual revenue of $3.3bn – less than half what it made the previous year. In 2011 it collected revenue just shy of $20bn.BlackBerry, which changed its name from Research in Motion (RIM) in 2013, reported annual revenue of $3.3bn – less than half what it made the previous year. In 2011 it collected revenue just shy of $20bn.
The company, which has cut thousands of jobs, made a pre-tax loss of $385m – an improvement on $7.2bn of losses the previous year. It made a pre-tax profit of $4.6bn in 2011.The company, which has cut thousands of jobs, made a pre-tax loss of $385m – an improvement on $7.2bn of losses the previous year. It made a pre-tax profit of $4.6bn in 2011.
John Chen, Blackberry’s chief executive, told investors that the pain may finally be over. “I am very pleased to announce that our financial house is in order,” he said. “Our financial viability is no longer in question.”John Chen, Blackberry’s chief executive, told investors that the pain may finally be over. “I am very pleased to announce that our financial house is in order,” he said. “Our financial viability is no longer in question.”
The company’s share price has collapsed by 95% since its height of $230 a share in the summer of 2007 (just as Apple launched the iPhone) to $9.6 a share today. The shares rose by 3.2% on Friday.The company’s share price has collapsed by 95% since its height of $230 a share in the summer of 2007 (just as Apple launched the iPhone) to $9.6 a share today. The shares rose by 3.2% on Friday.
Chen said morale at BlackBerry was at last beginning to improve. “The company needs to financially be stable. I don’t know of any way to improve the morale of a company, the people, if the company’s not doing well,” he said on a conference call with analysts. “I would say today the morale of the company’s a lot better than a year ago. It probably still needs to be a lot better than today.”Chen said morale at BlackBerry was at last beginning to improve. “The company needs to financially be stable. I don’t know of any way to improve the morale of a company, the people, if the company’s not doing well,” he said on a conference call with analysts. “I would say today the morale of the company’s a lot better than a year ago. It probably still needs to be a lot better than today.”
After years of trying – and failing – to keep up with Apple and touchscreen smartphone technology, BlackBerry returned to its roots in December by launching a phone with traditional Qwerty keyboard it called ‘the Classic’. The company did not say how many of the new Classic model it had sold.After years of trying – and failing – to keep up with Apple and touchscreen smartphone technology, BlackBerry returned to its roots in December by launching a phone with traditional Qwerty keyboard it called ‘the Classic’. The company did not say how many of the new Classic model it had sold.
Colin Gillis, an analyst at BGC, said Chen had done a good job since he came out of retirement to lead the company’s turnaround in November 2013.Colin Gillis, an analyst at BGC, said Chen had done a good job since he came out of retirement to lead the company’s turnaround in November 2013.
“The fact John Chen was able to do this despite a pretty sharp drop in revenue is impressive,” he said. “It’s on to phase two, which is ‘let’s become an enterprise software company’. 2016 is truly the transition year.”“The fact John Chen was able to do this despite a pretty sharp drop in revenue is impressive,” he said. “It’s on to phase two, which is ‘let’s become an enterprise software company’. 2016 is truly the transition year.”
Brian Colello, an analyst at Morningstar, said: “BlackBerry continues to do a good job controlling operating expenses and eliminating its cash burn during its business transition, but the total revenue was still a big miss and we still have concerns about the demand side of the equation.Brian Colello, an analyst at Morningstar, said: “BlackBerry continues to do a good job controlling operating expenses and eliminating its cash burn during its business transition, but the total revenue was still a big miss and we still have concerns about the demand side of the equation.
“It’s a good start; they are looking for a more meaningful ramp in the middle of the fiscal 2016, but certainly it’s a good start. It’s an early good sign.”“It’s a good start; they are looking for a more meaningful ramp in the middle of the fiscal 2016, but certainly it’s a good start. It’s an early good sign.”