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BlackBerry cuts 4,500 jobs as Q2 loss expected to approach $1b

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BlackBerry has announced, amidst a sad and disappointing second quarter, that it is laying off 4,500 jobs around the world, amounting to 40% of its workforce.

The news comes as the company announced an upcoming GAAP net loss for the second quarter of between $950 million and $1 billion, on revenue of $1.6 billion. The company expects to sell 3.7 million smartphones in the quarter, down almost 50% from last quarter’s still-disappointing 6.8 million haul. Unknown at this time are the number of BlackBerry 10 devices sold as a percentage of that total, since BlackBerry still sells a number of its legacy devices in developing countries, though they said “most of the units recognized are BlackBerry 7 devices, in part because certain BlackBerry 10 devices that were shipped in the quarter will not be recognized until those devices are sold through to end customers.” Of those 6.8 million in Q1, 2.4 million were BlackBerry 10 devices.

Today’s awful news comes in the middle of reports that the company is poised to be broken up into two or three parts, one focusing on handsets and manufacturing, the other on enterprise software and infrastructure. It also comes just a day after the announcement of its flagship Z30 smartphone and the final release dates of BBM for Android and iOS. Though there is reason for optimism in the BlackBerry camp, this news dowses much of that waning flame.

In a press release issued today, BlackBerry said that the layoffs are part of a restructuring plan to lower operating expenditures by 50% by the end of Q1 2015 (next July). Even if BlackBerry isn’t sold, though, there is still $2.6 billion in total cash and investments available to them, and they have no debt to speak of.

In a statement, CEO Thorsten Heins said, “We are implementing the difficult, but necessary operational changes announced today to address our position in a maturing and more competitive industry, and to drive the company toward profitability. 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.”

BlackBerry’s Q2 earnings will be announced Friday, September 27th. Shares are currently down more than 25% on the news.

  • hi

    OH MY GOD, WHAT HAPPENED TO MY BBRY!

    All money is lost, all jobs are lost, CEO gets away with $55m. Occupy BB?

    • Josh Brown

      Sorry dude but they died a while ago. Well there goes the neighbourhood.

    • erterte

      RIP in peace RIM

    • Humberto Giambrone

      Rest in peace in peace?

    • dickgozinya

      Pieces maybe. Lol.

    • erterte

      its an internet meme brah!

    • Sam

      its all because of the management they don’t care, the most important to keep their high position and lay off the workers~!!!!

      they are getting top $$$$ and they have fired 4500 poor families!!

    • erterte

      i dont know who’s worse, hitler or the CEOs who let this company’s workers down while still collecting their fat bonus checks. grats Heins, you just ruined a lot of families today, but you dont care, you still have your severance package all lined up and ready to go!

  • Kerry Butt

    Heins quote seems to mark the exit of BB from the consumer market.

    • MatroXX

      There seems to be little consumer market left for them. Focusing on what they are successful with is smart. They’re going back to their roots.

    • 01011001001

      except no one wants them there in either.

    • dickgozinya

      Ain’t that the truth.

  • Sweet

    CBC also reported that BB will offer 4 phones instead of 6, which IMO means that the Z10 and the Q5 are now end of line.

    • Brian Blaauwbroek

      True enough, at that point the leadership was no longer looking at making the company’s future viable, but rather looking to line their pockets. Nothing seems to have changed.

    • dickgozinya

      No, they ARE the line. After the z30 is released they will have full filled that commitment of 2 touch and 2 keyboard based devices. One each for the low and high end. Which BTW is a joke considering they all run the same SOC.

  • Ken K.

    RIP. It’s all the Co-CEO’s fault. Remember that time when they are looking to buy a hockey team for like 2 years? Talk about corporate incompetence.

    • Bj Kilganan

      the old CEO would have bought the team with his own money

    • Ken K.

      it’s not about where the money comes from; it’s about all the time and energy they wasted outside of their core competency areas. But then again they are not alone in facing the iPhone and Android Tsunami. Just ask Nokia, Microsoft, Palm etc.

    • iPlunks

      MS/Nokia are just fine in 3rd place

    • Josh Brown

      Third place yes, but a lap behind in terms of sales.

    • Alpine

      3rd place? more like last place..heck they aint even on the race same as BB…

    • iPlunks

      im sorry, please don’t comment if you have no idea what you’re talking about

    • Alpine

      it seems i hit a nerve..its ok tho no need to be sorry

    • Taylor Bolin

      when your as far behind as blackberry and microsoft are, does it even really count to call one of them third? does the guy who comes in 3rd still cheer when there are only 3 people racing?

    • iPlunks

      Yes it does. 1. MS is not far behind when their marketshare is going, just alot slower in the U.S. 2. If BlackBerry was 3rd you would say, BlackBerry is 3rd “hahaha”

  • Allwayswrite

    who cares?!! they have the best Mobile OS and they are visionaries in the field of……pppppppffft , bahahahahahah

  • Zee

    No worries everybody, BBM for Android/iOS launches this weekend!!!

    • Audrey Burne

      Reading this now is just hilarious!

  • Sweet

    It’s smart of them to cede the mainstream consumer market and focus on the enterprise and pro-sumer market. Hopefully they can pull out of the hole they’re in.

    • Josh Brown

      Sorry I hate saying this, but what company is going to invest thousands in a system that they are not sure is going to be there in 6 months.

    • Zee

      All the corporations that already use Blackberry and don’t want to spend the time or money to switch to a new system

    • Josh Brown

      Most are still using bb7 and when they switch it wont be to bb10. They have only sold 5 million bb10 devices in the world. Android activates 1.5 million a day.

    • bionicmonk

      Nah, the brand is dead. Done. It was done when they refused to compete with the iPhone in 2007 because they were the Almighty RIM.

  • jellmoo

    Wow. That’s terrible. THe 4500 people and Waterloo itself simply don’t deserve this. The sad part is that it isn’t the management of the company that gets cut, despite their complete and utter failure.

  • hardy83

    Don’t worry people! The important guys at the top are still getting their bonuses!

    In case any of you were freaking out at the thought of heads and CEOs salaries suddenly reflecting the success and profits of the company.

  • Brian Blaauwbroek

    Very sad and disappointing, but not unexpected.
    Would have loved them to be a contender, but after buying the Q10 I can see that they never will be.

  • lborsato

    When your favorite sports team fails they cut the coach. I business they fire half the players. I always wondered about that logic.

    • erterte

      its a lot harder getting players in sports due to all the rules. plus its probably much cheaper to cut 4500 jobs than to fire the CEO, who if fired, still walks away with his millions in bonuses that activate when he gets fired.

    • lborsato

      Agreed, but you’d think there would be a clause retracting the bonuses for complete failure to achieve the goals. Unless this is the goal.

    • RussianDroid

      You might be right and they are pulling “Elop maneuver” :)

    • erterte

      nope, which is why these people deserve to die. horribly. they fail at their jobs but they dont really care because either way they are still making millions.

    • TomsDisqusted

      It isn’t even Thorsten’s fault – it was the founder’s. While Amazon decided to build their own mobile OS they built on open-source software, and got something out in record time, RIM decided to build (almost) from scratch and it took more then 2 years.

      That multi year delay is what killed them.

    • dickgozinya

      Old Heinz ketchup is as much to blame for this disgrace as the old rejects from a reetard factory. How you don’t understand that is beyond me.

  • HowardJohnsonJr

    does this mean my curve will still work?

    • sam

      Oh yes because the management still there and your curve will support them and make them richer who cares its all workers fault

  • Rich

    Worst managed company imaginable.
    Hell, maybe the other two bozo CEOs should have stayed on (Lazaridis & Balsillie).

  • dickgozinya

    Hey JB: is the rest still static? Lol

  • Zee

    Being a Canadian this is very sad despite how much fun you can have making jokes at the expense of the company. They went from a small start up to ruling the mobile landscape for YEARS. Blackberries used to be a “must-have” device much like iPhones are now, and people were showing off with the latest BB device. Now they’ve gone from top of the heap to life support. What a disaster.

  • Humberto Giambrone

    I feel bad for the people getting fired, they are the ones who can afford it least and are least to blame, but such is the business world. I wish Blackberry had made a strong comeback (even though I personally opt for Android), but it just wasn’t in the cards. They were in the game, and then bumbled it all away.

  • Sylvain Larive

    Dump BBOS, switch to Android or Windows Phone. I guess I should revisit all those January post where we all got downranked by rabid fanboys telling us how we would be proven wrong and BB would come out on top!

    Become a premium Android partner. Google needs diversity. Bring back Android keyboards, unique BBM Android features, corporate apps.

    I hate to see a Canadian company go down in flames because it is too proud…

    • selonmoi

      That would have been a great plan 3-4 years ago. Now it’s too late. There is no coming back, sadly. It’s all over.

    • Tom

      It’s too late to switch to Android even if they wanted to. Also, if you look at HTC, one of the few handset manufacturers that barely has any businesses beyond phones, Android isn’t necessarily a lifesaver. HTC isn’t doing that well compared to its rivals.

      Samsung, LG, Sony, Huawei, etc have tons of other revenue sources to support themselves so they aren’t really affected by downturns in their smartphone revenue (in fact, most of them apart from Samsung aren’t turning much profit on smartphones). If BlackBerry were to enter the Android world, they’d be in the same shoes as LG and Sony and other not-so-popular OEMs, only that they don’t have TVs and monitors and laptops as backup sources of revenue.

    • Sylvain Larive

      I think the BB branding still has some ring to it. If they were to market their phones as robust, corporate Android phones I think they could jump past HTC, Sony, LG and Nokia…

    • dickgozinya

      A stinky ring. That’s it.

    • Doug

      Not likely. Sony and Nokia are much bigger names. HTC is the 3rd profit making in US after the majority Apple and Samsung. Only thing people associate BlackBerry with now is failure. They’re the new Palm.

    • Tom

      And that’s the problem – marketing. They failed to market BB10 effectively (even though it has impressive features), so I doubt they could market Android-powered BBs to save themselves.

      The other Android OEMs also have pathetic marketing in comparison to Samsung. When a new Galaxy S launches, you’re bombarded with ads everywhere you go. When a new Xperia launches, chances are you won’t even know about it unless you read a mobile enthusiast site.

    • bionicmonk

      Naw, its done. Its time to move on. They will be bought by Microsoft for their patents and thats the last you’ll hear of them.

  • 01011001001

    Well I’m sure those crazy bbfanboys and mods at crackberry will find a way to spin some good out of this.

    • Sylvain Larive

      Just took 30 seconds to go there. First article says : I’m happy to hear about the larger round of cuts at BlabkBerry. Says they were fat and needed to trim down… Blah blah… Ends with something like. If BB is to succeed as Niche player, it needs to trim down.

      First off, very inconsiderate of the employees who lost their jobs and furthermore, I don’t think BB’s plan were to be a niche player. Talk about denial!

    • 01011001001

      agreed, see told ya. I can’t say I blame them – they would say/write anything to keep their fans coming back – clicks pays the rent/mortgage.

    • Igor Magun

      Talk about selective reading, combined with a complete lack of understanding of what exactly is happening here.

      First off, the author did mention in the article his sympathy for the people affected. Being so closely involved with the company, he knows many of them personally and I doubt this is something he will take lightly on a personal level. But he’s a financial analyst by trade, and he’s analyzing the situation from a purely financial standpoint. A 50% reduction in operating expenses within 3 quarters sounds pretty compelling financially.

      Secondly, it very obviously was not BlackBerry’s plan to be a niche player. Their plan was to launch BlackBerry 10, have people adopt it and make money, then put that money towards developing it further and having a full lineup of successful devices that would secure them 3rd place in the smartphone market. That plan has clearly not worked. They are no longer on Plan A, this is very much Plan B in action.

      There’s no “denial” here, if you’ve ever listened to CrackBerry’s podcasts they are very realistic about the situation and realize that we don’t really know what the company will look like even 3 months from now. They’re simply recognizing that, if the company is to survive, some pretty major changes are going to be necessary.

    • 01011001001

      Ok you win, you figured it out that this was going to happen yesterday…. Wait a minute a lot of us figured out the end of bb and their demise a year or so ago. Selective reading? You have selective understanding is more like it.

      Those crackers at crackberry does a great job in brainwashing people.

    • Igor Magun

      At which point did I claim to have known that this was going to happen yesterday? I admit I was on the optimistic side until the last quarterly report, at which point I conceded that the management was pretty poor at executing – which is a shame because I do think BlackBerry 10 is a strong product.

      I’m not trying to “win” anything, I’m just clarifying misunderstandings. There was no lack of consideration for the employees in that article (that’s why I mentioned selective reading, as the original comment conveniently ignored the fact that the author mentioned this aspect of the situation), there was no implication that they were planning to be a niche player from the start, and having been around the community for some time, I don’t see any denial within the ranks of the writers either. Plenty in the readers mind you…

    • Sylvain Larive

      First off YES I read the entire article. But burying some half *ss sympathy behind an assassin title like they used deserved some flak. Its like when you read a sensational tabloid headline only to figure out that what was written in the article is toned down…

      And yes, it was denial, i don’t know what you consider denial, but that article clearly was a textbook denial I don’t care ifg the author has blogs or weekly columns where he has an alternate view, THIS article was denial. Sure, it’s a GOOD thing when our quarterly results show we’ve lost a billion dollarts and we have to fire 4500 people. We were too ambitious anyway!! Lets think INSIDE the box for a while…

    • dickgozinya

      Actually, they’ve become more reasonable than the shills here, and I know that’s a hard one to believe.

  • PlayerX

    No more rim jobs everyone!

    • dickgozinya

      Hahaha. In actuality, there may be more rim jobs on offer since a lot more will be unemployed.

  • southerndinner

    LOL at anyone insisting people buy a Z10

  • Sylvain Larive

    It’s the CEO’s fault, the hardware fault, the design team’ fault, the lack of marketing, the janitor’s fault and stupid buyer’ fault but surely this has NOTHING to do with BBOS, the UBEREST OS in the whole world!! Everyone I talked mobile phone to said they’ll never buy into anything other than the big 3 (2?) Mobile OS. No native app support.

    END. OF. STORY. Downrank me all you want rabid fanboys, somewhere buried deep inside you, a miniature, reasonable version of yourself will just nod in approval.

  • Wizzy

    Wait a minute! I thought these were rumors started by that tabloid WSJ! The BB phanboys said!

    I think that all BB phanboys were trained by the Iraq Department of Information.

    • skullan

      Congratulations Wizzy, you win. 4,500 people are going to be unemployed. Aren’t you special for getting that right.

    • dickgozinya

      If you want to gloat and cry you should be over at crackberry mourning with the rest of the psychopaths and deranged women.

    • skullan

      Hardly gloating and hardly crying. With that said, there is a certain amount of respect that needs to be given to the impending job losses at Blackberry.

      Keep in mind, in the end, it’s your tax dollars which will be taking care of the folks in need. I fully support that there is at least THAT social net to help.

    • dickgozinya

      Wizzy, ignore the trolls and bbry shills. They offer nothing to the conversation.

  • Mesooooosadhaha

    Lolz at you blackberry. You’ve had this coming to you for like FOREVER, what with your incompetence and arrogance. Thinking you know what the consumer actually wanted. Thinking you could get away with selling junk at premium pricing. Thinking you could get away wi providing abysmal corporate support for the crappy services you rendered. And on and on and on.

    Looks good on ya.

  • d a

    Bad management ALWAYS attacks labour. What else can they do, innovate? That boat sailed years ago at BB.

  • nig gie

    Next on the list should be Windows Phone…

    Then I will completely happy… so happy… I will cry tears of joy ;(

    • 01011001001

      WP is actually not bad, I have the 1020 and the 920 before that. The skydrive cloud service and xbox music integration works well not to mention office 365. There are big name apps that it’s missing like Dropbox or flipboard. I don’t think MS will fold that easy and has a better shot than BB that’s clear.

  • DEE

    On BB10 devices, corporate emails are integrated via ActiveSync. They’ve effectively reduced their flagship product – BES – to an MDM service.

  • trelaflip

    That’s brutal. Should of fired the CEO and kept the employees.

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