It is the latest fixture in a depressing saga for the manufacturer. Financial problems have come to a head and sales of the Z10 handset have been described as ‘disappointing’. In a bid to stem the losses, 4,500 job losses have also been announced.
Last week, investors were warned the company would be posting losses of up to $1bn due to low sales figures of its new range of smartphones. The news comes in the same week it was announced Blackberry had agreed to be bought by a consortium led by Fairfax International – its biggest shareholder.
The situation looks bleak for Blackberry. In the second quarter it sold 3.7 million smartphones – compared to 7.4 million during the same period in 2012. That is compared to the nine million iPhone 5S and 5Cs sold on their opening weekend.
“We are very disappointed with our operational and financial results this quarter and have announced a series of major changes to address the competitive hardware environment and our cost structure,” said Thorsten Heins, Blackberry’s chief executive.
Regarding the job cuts, a statement from Heins last Friday said: “We are implementing the difficult, but necessary operational changes announced today to address our position in a maturing and more competitive industry, and to drive the company toward profitability.
“Going forward, we plan to refocus our offering on our end-to-end solution of hardware, software and services for enterprises and the productive, professional end user.”
In 2009 in the US, Blackberry represented around 50 per cent of the market but since it has struggled to cope with the cool brand image of Apple’s iProducts and the wide range of Google devices. Since the introduction of the iPhone in 2007, Blackberry relied on its strength in the business community and supposed security advantages to maintain its market position.
According to the BBC, in a research note, Colin Gillis from the brokers BGC, described results as “startling weak” and plans to focus on corporate consumers might not be successful.
“While we applaud the decision to focus on retooling the company into a niche enterprise focused business, it seems years too late.
“Just as the consumer business has crumbled, the enterprise business is also in decay in our opinion.
“Given the negative news flow from the company, enterprise customers are likely to shy away from committing to a struggling platform.”