Doomed BlackBerry Bombs in the Third Quarter With $4.4 Billion Loss
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The fruits of the BlackBerry empire continue to shrivel.
The once-ubiquitous handset manufacturer announced today an abysmal $4.4 billion loss for its fiscal third quarter. This marks the first quarterly earnings report under the stewardship of interim CEO John Chen.
At the same time, BlackBerry announced a partnership with Chinese contract manufacturer Foxconn--producer of iPhones, iPads, Kindles, PlayStations and Wiis--to make and manage the inventory of new devices going forward, including smartphones targeting Indonesia scheduled for next spring.
While the Canadian government has forbidden the sale of Waterloo-based Blackberry to any Chinese company for reasons of national security, the partnership implies an abdication of BlackBerry's seminal handset business.
BlackBerry's dismal earnings follow the company's failed attempt last month to go private, when a takeover bid by Fairfax Financial Holdings fell apart and departing chief executive Thorsten Heins was replaced by Chen.
As an early and formidable opponent in the smartphone market, the company's station has all but plummeted today. This is due, analysts say, to a reluctance in embracing new hardware formats--such as touchscreens--and a miscalculated focus on corporate clients rather than everyday consumers who have come to use their phones for myriad forms of entertainment.
Even BlackBerry loyalists aren't warming to its latest products. Of the approximately 4.3 million BlackBerrys purchased during the third quarter, roughly 75% operate the now-obsolete BlackBerry 7 operating system, as opposed to the company's latest BlackBerry 10 line of phones launched earlier this year.