BlackBerry teams up with Foxconn for budget smartphones as sales continue to plunge
BlackBerry’s new interim chief John Chen has just got a rude wake-up call: the company realized revenue on only 1.9 million smartphones in Q1 compared to 3.7 million last quarter, and lost $4.4 billion. It also said that most of the phones shipped were BB7 models, and that much of the bloodletting can be chalked up to a massive $2.6 billion loss on BlackBerry 10 devices and other associated BB10 charges. Given that, Chen has already started making big changes, including a new organizational structure and partnership with Foxconn to build smartphones for emerging markets like Indonesia. The Canadian outfit’s now been divvied up into the following business: Enterprise Services, Messaging, QNX Embedded business and Devices. It hopes that’ll create more focus for the services group and greater efficiencies for its handset division.
Given that BlackBerry’s smartphone sales are now in freefall, the company also detailed its new five-year partnership with Foxconn. It said such a deal would let it focus on design and software, while “Foxconn’s scale and efficiency will let us compete more effectively.” Foxconn will build handsets in both Indonesia and Mexico, while BlackBerry said it would focus development on market segments still friendly to the brand, like enterprise and government. Meanwhile, the Waterloo company’s only bright spots in the quarter were messaging, with 40 million new Android and iOS users, and its bread and butter Enterprise services. However, given the hardware sales drop in just a single quarter as shown in this latest earnings report, it would appear that the next quarter or two will be do-or-die for the iconic company.
Filed under: Cellphones, Blackberry
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