updated 03:59 pm EDT, Fri September 20, 2013
Stock trading suspended for company in Toronto exchange, Nasdaq
Beleagured BlackBerry does not appear to be able to recover from its financial condition any time soon. Amid reports of its stock sales being stopped in Toronto and on the NASDAQ exchange, the company confirmed rumors that it will be laying off 4,500 workers in what may be a last-ditch to improve company finances. The move is necessitated by an expected second quarter operating loss of nearly one billion dollars on revenue of $1.6 billion from sales of 3.7 million phones and the attendant subscription fees.
In its most recent results prior to the earnings warning issued today, it was revealed that only 2.7 million BB10 devices shipped in the first full quarter of availability, less than half of the 6.8 million shipped by the company in total. The company also saw the previous operating profit of $94 million on $2.7 billion in revenues turn into a loss of $84 million on revenues of $3.1 billion. While CEO Thorsten Heins believed that the launch of the Z10 and Q10 phone lines weren't a "disaster," shareholders did. The CEO blamed US carriers and their "opportunistic thinking" in promoting only popular devices.
Heins said of the expected financial results that "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." BlackBerry's future smartphone portfolio will transition from six devices to four, including a pair of high-end devices and two entry-level devices.
The layoffs are part of a larger initiative to reduce operating expenditures by 50 percent by the end of the first quarter of its fiscal year 2015, which ends in June. The special committee of the Board of Directors will continue to explore "strategic alternatives" for the future of the company.
The full and final results for the quarter are expected on September 27 at 8AM ET.