BlackBerry 'very disappointed' in results as it pursues sale

Bloomberg NewsSeptember 28, 2013 

BlackBerry Sale

In this April 11, 2013 photo Fairfax Financial Chairman and CEO Prem Watsa speaks at the company's annual general meeting in Toronto. Watsa on Wednesday, Sept. 25, 2013 said he has every intention of completing the acquisition of BlackBerry, despite doubts that the $4.7 billion deal for the troubled smartphone maker will go through. (AP Photo/The Canadian Press, Frank Gunn)

FRANK GUNN — AP

TORONTO -- BlackBerry Chief Executive Officer Thorsten Heins, who is trying to take the smartphone maker private in a $4.7 billion deal, said he was "very disappointed" in last quarter's results as the company's sales plunged, especially in the Americas.

The company released a more complete financial report this morning following a preliminary statement a week ago that didn't provide regional breakdowns. Sales in the Americas, an area the company once dominated, fell faster than anywhere else, tumbling 56 percent to $610 million.

The report fleshed out last week's figures, which showed a wider loss and an unexpectedly sharp revenue decline. The company also is taking a pretax write down of $934 million for unsold phones and cut 4,500 jobs, or about a third of its workforce. BlackBerry said Friday that it would have $72 million in pretax expenses for restructuring.

Heins is working to slash costs after a tepid response to the new BlackBerry 10 lineup released this year. By going private, the company aims to tackle its challenges outside the glare of public markets. Fairfax Financial Holdings Ltd., BlackBerry's largest investor, said on Sept. 23 that it had signed a tentative offer to purchase the company with help from other partners. The firm hasn't identified the other buyers.

Investors remain skeptical about the deal. BlackBerry Thursday fell 0.7 percent to $7.95 in New York, marking the third straight day of declines. The tumble has taken the stock well below Fairfax's offer price of $9 a share.

BlackBerry said Friday that it had a loss last quarter of 47 cents a share from continuing operations, excluding one-time costs. Last week, it said the loss would be 47 cents to 51 cents a share. While the final number is at the low end of that range, it's still almost three times the size of the 16-cent loss originally predicted by analysts, according to data compiled by Bloomberg.

Total sales fell 45 percent to $1.57 billion, a little lower than the figure of $1.6 billion that BlackBerry gave last week. Analysts had estimated $3.03 billion.

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