More losses mean more optimism for BlackBerry
BlackBerry has been down on its luck recently, posting massive losses for the third and fourth quarter of 2013. New CEO John Chen is taking a page from BlackBerry's software and keyboard-focused past to rebuild its future.
What do you do when you post a $5.9 billion loss in one year? Remain optimistic – after all, when you hit bottom, the only way you can go is up.
That’s the goal of BlackBerry, which added a $423 million fourth quarter loss to its negative running total this fiscal year. With a new CEO, restructured corporate and manufacturing style, and a focus shift onto software, which launched BlackBerry to a top spot in the technology game not too long ago, BlackBerry says they are down, but not quite out.
“We were once a $20 billion company,” says John Chen, CEO of BlackBerry, to the New York Times. “It’s not out of the question that we could go back and recapture old ground. That may sound a little funny to you right now, but you never know.”
First step to getting back to the $20 billion mark? Stop posting losses, which Mr. Chen says can be done. Though revenue is down 64 percent from where it was at this time last year, and is down 38 percent overall this year, Chen is overseeing the elimination of more than one-third of the company's workforce. He also recently announced a deal with manufacturer Foxconn to outsource production and significantly cut down on hardware costs. The company, based in Waterloo, Canada, also recently said it would sell much of its Canadian real estate, and sold its US headquarters in Irving, Texas. Already Chen says the company is ahead of their cost-cutting target date.
What’s next? Return to BlackBerry’s roots as a software company. Chen is pushing a management system for corporations that makes it easier for IT departments to manage different devices. He is also pushing the QNX software system, an in-vehicle infotainment system, and BlackBerry Messenger for Android and Apple devices. Chen has also hinted that he might bring BlackBerry Messenger to desktops so business clients can hop from mobile to desktop messaging without switching the medium of conversation.
Device-wise, BlackBerry is also taking a page from previous success. Its new devices will return to a keyboard-based model, as its new touch screen models alienated its loyal customers. Its newest offering, the Q20, will bring back buttons – such as 'Menu,' 'Back,' 'Send,' and 'End' – and the trackpad. These will be marketed largely to government and enterprise customers.
BlackBerry will also increase production of the BlackBerry Bold, in response to the continued popularity of the old BlackBerry 7 OS. In the fourth quarter, Blackberry announced it sold about 3.4 million BlackBerry smart phones. About 2.3 million were BlackBerry 7 devices.