BlackBerry CEO says company will be back in the black by 2016

BlackBerry CEO says company will be back in the black by 2016
Following this morning's announcement that BlackBerry took a large $4.4 billion loss for its fiscal third quarter, CEO John Chen has made some very interesting comments. First, to review, the loss announced this morning includes a write down of $2.7 billion for unsold BlackBerry 10 models sitting in the warehouse. Since Chen has less than two months as CEO under his belt since taking over from Thorsten Heins, he cannot be faulted for these numbers.

As a further sign that BlackBerry 10 is just not connecting with consumers, of the 4.3 million handsets sold by the Canadian OEM in the last quarter, 3.2 million were models powered by the older BlackBerry 7 OS. Amazing, wouldn't you say? Revenue for the period dropped to $1.2 billion from $2.7 billion last year, and was a drop of 24% on a sequential basis.

But Chen might be ready to open up BlackBerry to turn the company around.. He talked about wanting to see the BlackBerry experience on iOS and Android, although he wasn't precise on what this means. He also talked about an upcoming BlackBerry handset coming next March or April that is codenamed Jakarta. Scheduled to launch in Indonesia first, this would be a BlackBerry 10 powered model and will offer 3G connectivity. If we didn't know better, we'd say that Chen has already studied the open letter written to BlackBerry by analyst Brian Blair. This model will be jointly developed by contract manufacturer Foxconn. The latter will handle inventory of the phone.

Chen also said that BlackBerry will focus on BBM. Earlier today, we told you how BBM for iOS and BBM for Android will soon receive other features that the service provides BlackBerry users, including BBM Voice, BBM Channels and BBM Video.

Trying to avoid layoffs, Chen states that BlackBerry will consider 2014 an investment year and he will try to prevent sacking employees by growing the company out of its current situation. He wants to build an enterprise sales force and believes BlackBerry will be cash flow neutral in 2015 and back in the black by 2016. This gives Chen the luxury of having a couple of years to try to find a successful game plan.

source: NYTimes, Crackberry (1), (2), Engadget

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18 Comments

1. reh1965

Posts: 19; Member since: Dec 06, 2013

Sure.. And mars will be invading us.

2. Droid_X_Doug

Posts: 5993; Member since: Dec 22, 2010

More like the moon is made of green cheese. Separately, I wonder who will be lending BB/RIM the cash to survive negative earnings until pthey get back in the black in 2016. They don't have that much cash/cash equivalents on their balance sheet.

15. snowgator

Posts: 3621; Member since: Jan 19, 2011

Very true. These last 2 quarters had to really force BB into their pockets to keep afloat. A couple more bad quarters? Sure, BlackBerry still has enough cash flow and the investment from Fairfax to survive. 2 more years??? That would need a ton more capital. And his is a hopeful outlook. I am still cheering for them. I think the mobile world is better with BlackBerry in it.

8. dickwyn

Posts: 621; Member since: May 07, 2012

don't judge too early a lot things can happen in two years time

3. amirlukmanhisyam

Posts: 44; Member since: Jun 26, 2012

He focus on Indonesia as there is still a quite number of loyal BB users there... Looks like he really do a research on which market to focus on instead of focus on a country that are controlled and manipulated by carriers.

13. Nikolas.Oliver

Posts: 1574; Member since: Jul 01, 2012

judging from your english it seems like you're indonesian aren't you? hehe bb udah jarang yang make

4. downphoenix

Posts: 3165; Member since: Jun 19, 2010

if they have 2.7 billion in unsold Z10 handsets, they probably should get those offloaded and get some cash flowin. Maybe cut a couple deals with prepaid carriers to sell them.

5. rusticguy

Posts: 2828; Member since: Aug 11, 2012

Is his term ending in 2016?

6. joaolx

Posts: 364; Member since: Aug 16, 2011

As a last option they can always make BB10 like Android, licensed for other manufacturers, that way maybe they'll have a chance at getting up but even then it would be hard to convince manufacturers.

7. sianto

Posts: 65; Member since: Dec 11, 2013

Although I have a Z10 (which I love BTW), I'm all in for that!

9. androidsbiggestfan

Posts: 76; Member since: Aug 09, 2011

No, not gonna happen pal! That is all!

10. JunkCreek

Posts: 407; Member since: Jul 13, 2012

amirlukmanhisyam, and seems like they're now too late to realize considering indonesia as their (used to be) biggest consumers.

11. amirlukmanhisyam

Posts: 44; Member since: Jun 26, 2012

As stated in the article "Since Chen has less than two months as CEO under his belt since taking over from Thorsten Heins, he cannot be faulted for these numbers." The CEO just on the helm for less than 2 months and he has to undone all the damage done by the previous administrator. Seems like he's more thorough regarding the market rather than just following other OEMs footsteps. Anyway still love to see how he's going to handle everything and how everything’s going to end up. Love to see BB10 OS to succeed and hope it will be less clutter with UI and gestures.

12. x78_nothing

Posts: 53; Member since: Feb 07, 2013

Still remember two years ago (2011-2012) bs said: BB is dead RIM=RIP or even BB10 was dead on arrival, currious to see what will they say in 2014? two years after?

14. tenzin

Posts: 111; Member since: Dec 20, 2013

I once tried blackberry 10 and since then I wouldn't come back to android or wp.they not selling well but their software is best for users

16. Ronny666

Posts: 128; Member since: Jun 08, 2013

Sorry to burst your bubbles but most indonesians only can afford feature phones or cheap knock-off smartphones from China due to poor economic status and purchasing power in that country. I highly doubt that Indonesia can contribute huge sales numbers for RIM.

17. darkkjedii

Posts: 31529; Member since: Feb 05, 2011

Good luck BB, hope you bounce back.

18. kenobi

Posts: 35; Member since: Apr 30, 2013

Indonesia was one of the main profit-generator for RIM and i dont know if it still is, but i do really REALLY hope BB jakarta would be Blackberry's next MASSIVE write down. What they did to Indonesia in regards to its "Blackberry Nation" status was terrible. They build their factory in Malaysia to sell in south east asia mainly Indonesia while the Malaysians themselves never favored BB and a lot of Indonesians need job. I hope their failures will be highlighted in business ethic history.

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