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Blackberry ships Z10s but can they stay competitive?

March 29, 2013

BlackBerry Ships 1 Million Z10s But Subscriber Base Declines
By Rob Wright

March 28, 2013    3:32 PM ET
There was good news and bad news for BlackBerry fourth-quarter financial results.

The bad news first: BlackBerry lost another 3 million subscribers in the first three months of this year, with its customer base falling to 76 million subscribers.

But the good news is, BlackBerry shipped approximately 1 million Z10 devices since the new smartphone was launched in recent weeks, with 6 million devices overall shipping in the quarter. In addition, the smartphone maker posted better than expected results with $2.7 billion in revenue with a profit of $94 million for the quarter.

[Related: BlackBerry 10 App Numbers Growing, Android Ports Falling]

Most of that revenue, or 61 percent, came from BlackBerry hardware, while services accounted for 36 percent and software and other areas made up the last 3 percent. The hardware revenue includes 370,000 BlackBerry PlayBook tablets.

"As we go into our new fiscal year, we are excited with the opportunities for the BlackBerry 10 platform, and the commitments we are seeing from our global developers and partners," said BlackBerry President and CEO Thorsten Heins in a press statement. "We are also excited about the new, dynamic culture at BlackBerry, where we are laser-focused on continuing to drive efficiency and improve the Company's profitability while driving innovation. We have built an engine that is able to drive improved financial performance at lower volumes, which should allow us to generate additional benefits from higher volumes in the future."

BlackBerry also announced that it plans to increase its marketing spend by 50 percent sequentially next quarter to support the global launch of BlackBerry 10 devices like the Z10 and the forthcoming BlackBerry Q10.

But, the company still has daunting hills to climb; the release date for the keyboard-based Q10 phone, aimed at BlackBerry loyalists, was pushed back to late spring/early summer, and while BlackBerry World now has more than 100,000 apps for BlackBerry 10, the OS is still missing some popular apps like Instagram and Netflix.

For the first quarter of fiscal 2014, BlackBerry said it expects "breakeven" financial results on lower costs, improved hardware margins and a more efficient supply chain.

BlackBerry also announced that co-founder Mike Lazaridis has stepped down as vice chairman of the board of directors and retired from the company. Lazaridis, who recently founded venture capital firm Quantum Valley Investments, stepped down as co-CEO along with Jim Balsillie in early 2012 following Heins' appointment as president and chief executive.

"With the launch of BlackBerry 10, I believe I have fulfilled my commitment to the Board," Lazaridis said in a press statement. "Thorsten and his team did an excellent job in completing BlackBerry 10. We have a great deal of which to be proud. I believe I am leaving the company in good hands. I remain a huge fan of BlackBerry and, of course, wish the company and its people well."

PUBLISHED, MARCH 28

 

http://crnnetwork.com/portal/wts/cemceDmdAuqqeew-qLFDy86ersfA2c



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