As unsold BlackBerries pile up, RIM risks a $1 billion write-down

As unsold BlackBerries pile up, RIM risks a $1 billion write-down
RIM’s BlackBerry sales have plunged and the company is piling up unsold inventory, risking another huge write-down, this time expected to be as much as a massive $1 billion. Earlier, Research In Motion was forced to write down nearly half a billion dollars because of unsold PlayBooks, and last quarter it had to write off another $267 million due to a pile-up of BlackBerry 7 smartphones.

With no notable launches this year, and BlackBerry 10 only expected late in 2012, the company’s portfolio is looking weak. And when compared with the current crop of well-specced Android phones, it's even harder for customers to find a compelling reason to buy a dated BlackBerry 7 phone, or a PlayBook tablet. 

RIM’s in-house supply value rose by 18% just this last quarter, and this doesn’t include BlackBerries gathering dust at carriers, retailers and other distributors.

Since last quarter, RIM stopped giving sales and profit guidance due to “ongoing weakness” in the United States. Also, the company is said to have to slash 2,000 to 3,000 jobs in an attempt to save operating costs. Last summer, the company already cut 2,000 jobs, but the "workforce optimization" is expected to continue.

source: Bloomberg

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29 Comments

1. Mxyzptlk unregistered

Guess people are no longer liking blackberries. They prefer apples now lol.

7. kshell1

Posts: 1143; Member since: Oct 05, 2011

Sure some prefer apple phones, but if you pay attention to market share blackberry is weakening and android is strengthening suggesting BB users are going to android.

27. Mxyzptlk unregistered

That little robot is green for a reason.

22. GuiltyBystander

Posts: 199; Member since: Mar 05, 2012

I see what you did there ;)

26. Mxyzptlk unregistered

;) I am clever.

2. darktranquillity

Posts: 285; Member since: Feb 28, 2012

already weak and now pregnant too:-/

3. Galen20K

Posts: 577; Member since: Dec 26, 2008

a Billion dollar write off?! how much longer can RIM exist in its current incarnation....

14. remixfa

Posts: 14605; Member since: Dec 19, 2008

RIMs bread and butter doesnt come from hardware sales, it comes from business email access licences to the tune of tens of billions a year. As long as they have that, they will be OK for a few years. Unfortunately for them, iOS and android are quickly eroding the business sector away from them.

4. OpTiMuS_BlAcK

Posts: 418; Member since: May 04, 2012

Just give them away. xD

5. Jericho unregistered

@victor you got that right androids are just highly spec'd. Looking at the competition other os'es are optimised and can run better on less spec'd hardware. Examples. Meego, ios, windows phone, bb os 7, and even Nokia belle(which i don't think is outdated). Blackberries are my #1 choice if i want a hardware keyboard. And i also hate the appstore arguement cause i think that's B.S.

6. Victor.H

Posts: 1079; Member since: May 27, 2011

The main point here is that those BB7 models look plain old now. And I agree that optimization goes a long way, and specs of course aren't the thing that most users care about. Like it or not, though, they still define the software experience and that's where RIM needs to catch up.

8. Jericho unregistered

agreed. except general users care more about specs then the software.

13. ardent1

Posts: 2000; Member since: Apr 16, 2011

Jericho, you are in the minority now. People like you still want physical keyboards, but people like you are no longer part of the majority. How times have changed.

15. remixfa

Posts: 14605; Member since: Dec 19, 2008

BB used to be the best game in town for typing. Yup, times have changed.. and they will continue to change as things always do.

24. Jericho unregistered

i think you didn't read my comment properly i said ''IF'' i want a hardware keyboard. cause i am totally okay with a virtual keyboard.

18. sonisoe

Posts: 440; Member since: May 06, 2009

yup... if i had any choice i'd stick with my lumia 800 or iphone 4, thing is while android - despite version 4.0 - is still experiencing its typical bugs..i like all the features and apps that i need only on android...and i love my sgs2 (the least bugged - if not free - android device i've ever owned)...

29. vqc61

Posts: 15; Member since: May 16, 2012

I agree with Jericho. As an engineer, I really appreciate elegant and efficient designs (in software, hardware, anything...). BlackBerry OS, for example, is extremely efficient in data usage, and that feature alone is worth more to me than any flashy apps that I can't use because they will cause my data usage to go over the cap. Regarding the comment below "BB7 models look plain old now" - "look" is a very subjective matter. I personally think that the "brick" design of nearly all Android devices looks very generic, cheap and plain. Just my opinion, of course. It's a fact that Android is taking over the market, but I really doubt that people actually purchase an Android device because they use the advanced features offered by the OS. Unfortunately, most people made their purchase based on influence from others (sales reps, kids, co-workers, etc...) instead of their needs. I know a lot of smart people who would show me their latest Samsung (or Motorola) phone and say "I just got this phone and my [son, husband, wife] is setting it up for me, I'm not sure how to...". I guess it's great for the economy, and bad for RIM.

9. e.wvu unregistered

The simply just need to stop releasing new blackberries every month or so that looks exactly like the previous blackberry w/ similar specs, but just giving it a different name. And they need to release BB10 (it's BB10, right?) now or very soon rather than wait until the end of the year to release it because it might be a little to late...

10. pongkie

Posts: 663; Member since: Aug 20, 2011

they should do a fire sale

11. angelesmec unregistered

RIM, why continue on staying on mobile phone bussiness though BB phones are not as competent as Apple or Android? It is much better to stop producing phones and invest in something else..like for example run a restaurant or a hotel or anything that you could earn a lot that is within the interest.. better to gave up on mobile phones..

12. tward291

Posts: 559; Member since: Feb 14, 2012

the only thing keeping RIM up is there messaging service they should just make it avaliable to all platforms for a fee to bring in some revenue.

16. GuiltyBystander

Posts: 199; Member since: Mar 05, 2012

Maybe they should consider lowering the price of their phones.

20. ilia1986 unregistered

Or switching to Android...

21. Mittal

Posts: 494; Member since: Dec 14, 2011

Bang on! Even after realising that their offerings are becoming more obsolete ny the day, why the hell dont they drink up their ego and reduce the prices? I know no company which has once been KING will want to do that, but then either come upto par with competition, or at least reduce the prices! They want to release BB10 devices at the end of this year?? hahaha by then we would only read about BB on Wikipedia with a special Papyrus background!

17. sonisoe

Posts: 440; Member since: May 06, 2009

theyve been cutting jobs, they seem to enjoy it and come tomorrow morning, the ceo will be asking "where is everybody ? the whole building just for me ?"

19. kshell1

Posts: 1143; Member since: Oct 05, 2011

I expect BB to file bankruptcy in a few months to be honest. They are barely selling anything right now and another 6 months until BB10? I don't think they can survive

23. Beholder88

Posts: 86; Member since: Mar 30, 2012

I agree, Blackberry needs to get out of the handset market and possibly start putting together Android or iOS apps that utilize their services. I've spoken to a lot of people who hate the phones, but loved the services they provided. That being said, even if they stayed in the handset market, it might be best for them to dump the BB OS and current handset design, then use Android as a backbone and create something with great specs and all the classic BB services like BBM and secure email. I want to clarify that I am not trying to sound biased towards Android here, but iOS is not exactly friendly to the full on customization that would be needed for something like this.

25. axllebeer

Posts: 272; Member since: Apr 05, 2011

Well, I know there current BB OS is dated and they will not be able to draw in anyone to speak of from another platform as things sit currently. That said, it's all in what matters to you in a mobile device. Remember those contests that they were doing with Windows Phone to challenge people do accomplish a task faster on their current phone? I still say there is nothing I could do any faster on Android or IOS that I use my BB Bold for. There's plenty that the other platforms have to offer that a BB can't do, but what it can do for me, I am way more efficient on a BB by far. For me, it's about getting sh1t done :)

28. hltechie unregistered

Looks like the end is near for BlackBerry. It just seems like they are desperately trying to compete with Android and iOS but simply can't.

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