BlackBerry groups up with Foxconn for finances smartphones as gross sales proceed to plunge
BlackBerry’s new interim chief John Chen has simply acquired a impolite wake-up name: the corporate shipped just one.9 million smartphones to retailers in Q3 in comparison with three.7 million final quarter, and misplaced $four.four billion. A lot of the telephones shipped have been decrease-priced BB7 fashions, and it misplaced an enormous $2.6 billion on unsold BlackBerry 10 units and different related BB10 costs. Retail channel gross sales (of telephones already shipped) through the interval additionally confirmed the size of the drop in its upmarket telephones: of four.three million units bought to finish-customers, just one.1 million have been BB10 handsets. Provided that, Chen has already began making massive modifications, together with a brand new organizational construction. The corporate will quickly be divvied up into the next enterprise models: Enterprise Providers, Messaging, QNX Embedded and Units. He hopes that’ll create extra focus for the providers group and higher efficiencies for its handset division.
With smartphone gross sales in freefall, BlackBerry additionally detailed its new 5-yr partnership with Foxconn. It stated such a deal would let it give attention to design and software program, whereas “Foxconn’s scale and effectivity will allow us to compete extra successfully.” Foxconn will construct handsets in each Indonesia and Mexico, and BlackBerry stated the primary units shipped in March or April 2014 can be BlackBerry 10 handsets aimed toward rising areas. For different markets, it’s going to focus improvement on segments nonetheless pleasant to the model, like enterprise and authorities. In the meantime, the one shiny spots within the quarter have been messaging, with forty million new Android and iOS customers, and its bread and butter enterprise providers. Given the hardware gross sales drop in only a single quarter, nevertheless, it appears to be do-or-die time for the long-lasting firm.
Replace: CEO John Chen is providing a couple of extra particulars in a comply with-up interview with reporters and analysts. He mentions that the cope with Foxconn will assist alleviate the danger of getting extra stock: “What we have now executed at this time is … taken our stock down that scales to the extent of the handsets we anticipate to promote.” However regardless of its new give attention to rising markets, Chen says that BlackBerry will proceed to work on “evolving and refreshing handsets,” noting that the Waterloo aspect of the corporate will stay targeted on excessive-finish units, whereas Foxconn will give attention to the low-finish.
Chen additionally says that one among BlackBerry’s huge areas of focus can be on regulated business, comparable to authorities, and that the corporate nonetheless sees safety as completely important to its future success; in truth, he specifies Verizon and AT&T’s enterprise teams nonetheless contemplate BlackBerry to be the gold normal in safety, and proceed to be excited for its merchandise.