More than $2bn was wiped from the stock market value of
smartphone maker Blackberry on Friday after financial results
suggested its bid to join the personal computing revolution had hit
the wall.
Wall Street analysts had expected the Canadian company to produce
a modest $25m (£16.4m) operating profit but instead the firm
revealed a shock $169m loss and missed its sales targets.
BlackBerry has spent the last 18 months evolving its handsets from
email machines to internet phones capable of hosting any application
from Ebay to Twitter.
But the group shipped just 2.72m of its new generation Z10 and Q10
handsets in their first full quarter on sale, up from 1m last quarter.
Wall Street had been expecting an already weak 3m. In total, 6.8m
Blackberry handsets were shipped in the three months to the
beginning of June, fewer than a year ago and well below forecasts of
8m.
The news shook hopes that chief executive Thorsten Heins, who took
control last year from the company's founder Mike Lazaridis, had put
BlackBerry on a firmer footing against Apple and Samsung. The
heavily shorted shares crashed 27% in three hours, losing every cent
gained since January.
"We are doing the right thing," Heins assured investors on Friday. "A
transition takes time."
Analysts said BlackBerry was fast running out of options. Overall
revenues were up 15% on the previous quarter, but the safety net of
monthly subscriptions to its business and consumer services is being
whittled away – subscriber numbers fell to 72 million, from 76
million in the previous quarter.
"In terms of user traction they are in crash mode," said Pierre
Ferragu at asset manager AllianceBernstein. "They are getting closer
and closer to the ground at an accelerating pace. You should never
say never but it is probably too late for them to be acquired by
anyone."
Rumours that Chinese manufacturer Lenovo was interested in
acquiring BlackBerry had helped lift its by a quarter since January,
and its stock market value stood at $7.6bn on Thursday night. By
mid-afternoon on Friday, this had fallen to $5.4bn.
The financial picture was further darkened by a planned currency
devaluation in Venezuela, which held back payments from
BlackBerry subscribers in the country, and slashed $72m from
service revenues.
In its first-quarter results statement, the company said: "The
smartphone market remains highly competitive, making it difficult to
estimate units, revenue and levels of profitability." As a result,
operating losses are expected to continue, with the company
forecasting more in the second quarter. BlackBerry still has a cash
cushion of $3.1bn, its biggest for three years.
Recent weeks have seen executives depart in key markets. Rob Orr,
promoted to UK managing director nine months ago, has left to join
Samsung and Sunil Dutt, managing director of BlackBerry's sizeable
Indian business, quit in March, 14 months after joining the firm.
Mike Walkley, an analyst with broker Canaccord Genuity, said: "With
Z10, Q10, and Q5 all shipping in the August quarter and BlackBerry
still guiding to a loss we believe that is strong evidence BB10 has not
turned around BlackBerry in an extremely competitive smartphone
market."


http://m.guardian.co.uk/technology/2013/jun/28/blackberry-shares-fall-loss

Heard they are considering selling their 'pinging' rights how true is this?

This is just the begining.

It's over for this big boy! I wonder what would happen when bbm is integrated into android and ios. My advice for RIM,sell to samsung or google now!