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Blackberry records US$4.4b loss in Q3
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BlackBerry reported a massive US$4.4 billion loss in the third quarter and a 56 percent drop in revenue in its first quarterly report under new chairman and CEO John Chen.
Despite the results, Chen said on a conference call with analysts that BlackBerry “has a really good shot” of turning a profit in 2016 and management will try its best to achieve the goal. Chen later laughed when an analyst wished him the “best of luck.”
The former Sybase CEO is credited with turning around Sybase, a data company that was sold to SAP in 2010. Chen said reviving BlackBerry will be his most “complicated” challenge but noted, however, that the company has US$3.2 billion in cash, which will “definitely allow us to engineer our turnaround.”
BlackBerry also said on Friday that it’s entering into a five-year partnership with Foxconn, the Taiwanese company that assembles products in vast factories in China. Foxconn, known for its manufacturing contract work on Apple’s iPhones and iPads, will jointly design and make most BlackBerry devices and manage inventory of the devices in an agreement that will offload much of BlackBerry’s manufacturing costs.
“I’m hoping we never have to have a conversation going forward about inventory write downs,” Chen said.
He said Foxconn’s BlackBerry phones will be released in March or April and will be built in Indonesia and Mexico.
BlackBerry reported revenue of US$1.2 billion, down from US$2.7 billion in the same quarter last year.
Chen has said the company “is very much alive” but is putting more emphasis on Blackberry’s software business than its hardware business.
“I’ll be happy to have a breakeven or a low margin device business and then have that help us to monetize software,” said Chen.
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