Blackberry maker warns of loss in Q1 and announces job cuts
Research In Motion (RIM), the company behind the Blackberry smartphone, has warned it will make a loss in its latest quarter and make “significant” job cuts.
RIM also said it was hiring JPMorgan and RBC Capital Markets to help with a “strategic review” of the business.
It has lost ground as its traditional business clients have switched to iPhones or Android phones.
RIM shares fell 10% in after-hours trading.
Some have speculated that the strategic review may lead to a sale of the firm.
“The on-going competitive environment is impacting our business in the form of lower volumes and highly competitive pricing dynamics in the marketplace, and we expect our first-quarter results to reflect this, and likely result in an operating loss for the quarter,” chief executive Thorsten Heins said.
“There will be significant spending reductions and headcount reductions in some areas throughout the remainder of the fiscal year,” he added.
In the last financial year, RIM made a net profit of $1.2 billion, down from $3.4 billion in the previous year.
Thorsten Heins added: “Our global subscriber base continued to grow this quarter to approximately 78 million, driven primarily by growth in international markets, which is partially offset by high churn in the United States.”
Once heralded as one of the fastest-growing companies in the world, RIM has struggled to keep up with rivals in the smartphone market, such as Apple’s iPhone and handsets running on Google’s Android operating system.
It has also struggled to gain a foothold in the tablet market.
The launch of Blackberry 10, expected later this year, and a much-delayed new operating system, are expected to be crucial to its turnaround plan.
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