More Pricing Cuts as BlackBerry Shows Poor Earnings
More Pricing Cuts as BlackBerry Shows Poor Earnings by UCStrategies Staff
An annual loss of $1.3 billion was announced by BlackBerry at the end of last week, and the company’s CEO, Thorsten Heins, noted that he was “very disappointed,” adding that a number of changes are in progress in order to address the fall. Over $995 million in losses has been announced by the company.
The decrease in revenue and market share has meant that the company will take a $934 pretax writedown, accounting for unsold inventory. Furthermore, around 4,500 employees of the company will be let go, highlighting that the company is seriously considering restructuring and focusing more on its key goals.
Fairfax Financial Holdings is an investing company with a 10 percent stake in BlackBerry, and has offered the company a $4.7 billion deal along with other investors on Monday to take the company private. BlackBerry has until November 4th this year to consider the deal and its options.
A $9 market share is offered by the Fairfax deal, and on Thursday last week, BlackBerry stock stood at $7.95 before rising to $8.09 the next day. Heins presented forward-looking statements hoping that this would mean greater adoption of the BES 10 mobile device management solution for enterprise.
Heins said: “We continue to see confidence from our customers through the increasing penetration of BES 10, where we now have more than 25,000 commercial and test servers installed to date, up from 19,000 in July 2013.”
49 percent of the company’s quarterly earnings were made up of hardware, and services accounted for 46 percent, whilst software made up only 5 percent.
BlackBerry’s financial report shows that the company sold around 5.9 million BlackBerry smartphones in the quarter, and made revenue on 3.7 million smartphones; most of the latter were BlackBerry 7 devices.
BlackBerry “remains a financially strong company with $2.6 billion in cash and no debt. We are focused on our targeted markets, and are committed to completing our transition quickly in order to establish a more focused and efficient company,” said Heins. (CY) Link