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BlackBerry Remains Committed To Smartphone Business, Despite $670M Net Loss In Last Three Months (baytoday.ca)

Posted by BeauHD on from the time-to-throw-in-the-towel dept.

AchilleTalon writes: BlackBerry CEO John Chen refuses to give up on the company's hardware business despite lackluster sales of its first Android-powered smartphone, the Priv. The Canadian smartphone maker reported a $670 million net loss in the first quarter of its 2017 financial year, but said its recovery plan for the year remains on track. Chen, who has stated the company's No. 1 goal is to make its smartphone device business profitable this fiscal year, said he expects the company's new mobility solutions segment to break even or record a slight profit during the third quarter, which ends Nov. 30, 2016. During BlackBerry's first quarter -- second full quarter to include Priv sales -- the company sold roughly 500,000 devices at an average price of $290 each, he said, which is about 100,000 smartphones fewer than the previous quarter and about 200,000 fewer than two quarters earlier. Previously, the company said it needs to sell about three million phones at an average of $300 each to break even, though Chen indicated that may change as the software licensing business starts to contribute to revenue.

1 of 78 comments (clear)

  1. Long lived asset impairment charges by Subratik · · Score: 3, Interesting

    It's worth mentioning that most of their loss came from a long lived asset impairment charge of 500 million, not inventory write down. Most articles are insinuating that handsets are the cause of their losses by lumping it in the same headline which is inaccurate. They did only sell around 500k devices this quarter which is low for any smartphone company. However, the CEO has gotten the cost of the handset business to be break even at 3 million phones. If you contrast that with the billions Blackberry was writing down on handsets alone a few years ago, you can see why it's not a horrible decision. Besides, it sounds like they want to start licensing out their software like the HUB and BBM to other manufacturers, and I don't know who would take them up on that unless they could prove their own users are installing/using it.