Blackberry to cut 4,500 jobs, Q2 revenue to be $1.6 bn

Thorsten Heins_president & CEO_BlackBerryBlackBerry expects Q2 revenue to be approximately $1.6 billion, of which 50 percent is expected to be service revenue.

For the second quarter, the company expects to recognize sales of approximately 3.7 million BlackBerry smartphones. Most of the units recognized are BlackBerry 7 devices because certain BlackBerry 10 devices that were shipped in the quarter will not be recognized until those devices are sold through to end customers.

During the second quarter, approximately 5.9 million BlackBerry smartphones were sold through to end customers, which included shipments made prior to the second quarter and which reduced the Company’s inventory in channel.

As a consequence of the more intense competition the company is experiencing in its hardware business, it expects to report a primarily non-cash, pre-tax charge against inventory and supply commitments in Q2 of approximately $930 million to $960 million, which is primarily attributable to BlackBerry Z10 devices.

As previously disclosed, the company anticipated generating an operating loss in the second quarter.  The company currently expects that its adjusted net loss, before giving effect to the inventory and restructuring provisions referred to above, will be in a range of approximately $250 million to $265 million.

At the end of the second quarter, total cash, cash equivalents and investments is estimated to be approximately $2.6 billion.

BlackBerry also announced plans to transition its future smartphone portfolio from six devices to four. The portfolio will focus on enterprise and prosumer-centric targeted devices, including 2 high-end devices and 2 entry-level devices in all-touch and QWERTY models.

Furthermore, the company also announced that it is targeting an approximate 50 percent reduction in operating expenditures by the end of the first quarter of fiscal 2015. As part of this, BlackBerry will implement a workforce reduction of approximately 4,500 positions or approximately 40 percent of the company’s global workforce resulting in a total workforce of approximately 7,000 full-time global employees.

Thorsten Heins, president and CEO, BlackBerry said, “Going forward, we plan to refocus our offering on our end-to-end solution of hardware, software and services for enterprises and the productive, professional end user. This puts us squarely on target with the customers that helped build BlackBerry into the leading brand today for enterprise security, manageability and reliability.”

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  1. Pingback: Fairfax-led consortium to acquire BlackBerry for $4.7 bn - Teleanalysis

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