BlackBerry admits disappointing sales
28 Sep 2013
BlackBerry Ltd reported a deep second quarter loss on Friday, with decline in smartphone sales and increase in operating expenses.
It has been a disappointing quarter for the company as its revenues almost halved to $1.6 billion for the quarter that ended 31 August 2013 with a net loss of $965 million, or $1.84 a share, which when compared with revenue of $2.9 billion and a loss of $229 million for the same quarter last year.
BlackBerry also reported $72 million in pretax expenses for restructuring. CEO Thorsten Heins said, ''We are very disappointed with our operational and financial results this quarter.''
A series of major changes to tackle the competitive hardware environment and cost structure has been pronounced by Heins in a statement.
The loss included a markdown of about $934 million for unsold Z10 phones, a touchscreen model that the company had hoped would reverse its fading fortunes.
By slashing prices, BlackBerry hopes Z10 will find its market among the vast population of smartphone owners and will strengthen its position in the developing markets.
The phone unfortunately sold badly with business and consumer customers alike.
The turmoil and uncertainty at BlackBerry appears to be affecting its sales efforts.
T-Mobile US Inc said it would no longer stock the devices in its stores, instead shipping them to anyone who come in to order a BlackBerry.
One of BlackBerry's main contract manufacturers, Jabil Circuit Inc, said it probably would part ways with the company, its second-largest customer.
The company said it had sold 5.9 million mostly older-model phones in the quarter but only recognised revenue of $3.7 million.
