Financial News

  • 30 March 2014, 15:51

BlackBerry Loses $423m In Three Months

Struggling smartphone maker BlackBerry has made a quarterly loss of $423m (254m), after suffering a revenue drop of more than 60%.

The company said its revenue for the last quarter of 2013 was $976m (587m), down from $2.7bn (1.6bn) in the previous year.

It was the first time the Canadian company had reported quarterly revenue of below $1bn (600m).

The figure was more than a tenth lower than what analysts had forecast.

Sales of smartphones fell from 1.9 million in the third quarter to 1.3 million in the fourth quarter.

It was the second quarterly results under new boss John Chen, amid a strategic shift from being hardware based.

"The guy is on the move fast," BGC Partners analyst Colin Gillis said.

"He can control expenses but you can't magically make revenue happen."

Early last year the company released BlackBerry 10 but it failed to spark a turnaround in its fortunes.

The BlackBerry, once considered an essential business tool, has been hammered by competition from iPhone and android-based rivals.

Last week the firm said it moved ahead with plans to sell off most of its Canadian property portfolio to help shore-up its finances.

Despite the massive quarterly loss, early Friday trades in BlackBerry were some 5% up, buoyed by faster-than-expected cost cutting.

In January, its share price surged after the US military put in a huge order for its phones, as it announced it would outsource production to Taiwan's Foxconn.

BlackBerry helped create a culture of mobile users glued to smartphones - and were once nicknamed "CrackBerrys" in reference to the addictive habit of checking emails.

The encryption system used by the firm was also seen as a benefit for many firms, including the White House administration.

But the firm lost its pre-eminent position as people swapped to Apple and Android devices.

The company still has around 70 million subscribers worldwide, but most of these are using older handsets.