Blackberry reports $965m second quarter loss

Blackberry has reported a second quarter
net loss of $965m (£600m) following a
slump in sales.
The company warned investors last week that it
would report a loss of up to a billion dollars,
due to poor sales of its new smartphones.
It also announced 4,500 job cuts in a bid to
stem those losses.
Earlier this week Blackberry agreed to be
bought by a consortium led by Fairfax
Financial, its biggest shareholder, for $4.7bn
(£3bn).
Blackberry said it would continue to explore
other options while negotiations with Fairfax
continued.
The company's financial problems came to a
head this year following disappointing sales of
its new Z10 smartphone.
Sales were so poor that Blackberry had to
write off $934m in the second quarter to
account for the weakness.
Disappointment
Released in January - after many delays - the
phone has failed to enthuse consumers.
The firm reported total sales of $1.6bn
compared with $3.1bn in the same quarter of
2012, a near 50% fall.
"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.
In the second quarter, Blackberry said it sold
3.7 million Blackberry smartphones. That
compares with 7.4 million shipments in the
same period of 2012.
To put that into perspective, Apple sold nine
million of its new iPhone 5S and 5C models on
the opening weekend of sales.
Decay
In a research note, Colin Gillis from the
brokers BGC, said the results were "startling
weak".
He said the company's plan to focus on
corporate customer, might fail.
"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," Mr Gillis said.