BlackBerry is pulling out the Classic, as it reports almost half a billion dollar lossBlackBerry reported a loss of US$423 million, for its fiscal fourth quarter which ended March 1, but expects to start generating a profit in fiscal 2016.
Revenue was $976 million, down from $2.7 billion a year ago. In an apparent about-face, Blackberry CEO John Chen is betting the company can return to making money from selling smartphones.
He announced plans to relaunch production of the older BlackBerry 7 mobile device because of a strong global demand.
During the fourth quarter, approximately 3.4 million BlackBerry’s were sold through to end customers, approximately 2.3 million were BB7 devices. BlackBerry’s 7 operating system is over three years old.
He also touted upcoming launches of new devices aimed at emerging markets and another phone – the Classic – targeting BlackBerry’s traditional business customer base.
“I hope nobody thinks we don’t take seriously the handset business,” Chen told investors, speaking on the company’s fourth-quarter earnings call. The revenue breakdown for the quarter was (approx) 37% for hardware, 56% for services and 7% for software and other revenue.
However, it wasn’t all bad news for the beleaguered phone maker, which now has under 0.5% share of the Australian phone market, according to Kantar Worldpanel.
Adjusted Q4 gross margin rose to 43%, up from 34% in the prior quarter.
The Canadian phone maker reached its expense reduction target one quarter ahead of schedule, and cut operating expenses by 51% from Q1 FY14.
Chen said he was “very pleased” with progress and execution in fiscal Q4 against the strategy laid out three months ago.
“BlackBerry is on sounder financial footing today with a path to returning to growth and profitability.”
The Company anticipates maintaining its strong cash position and says its continuing to look for opportunities to streamline operations.
BlackBerry is targeting break even cash flow results by the end of fiscal 2015.
