Dec. 20 - The struggling smartphone maker is tying up with iPhone assembler Foxconn to make phones and try to return to profitability. Fred Katayama reports.
John Chen got the bad news out early in his first report as CEO. BlackBerry lost a massive $4.4 billion in a quarter that saw many senior executives leave. Restructuring charges hurt earnings as revenue plunged by more than half. Chen says his top challenge is making its phones profitable. Toward that end, BlackBerry is tying up with iPhone assembler Foxconn. They'll turn out BlackBerry phones for Indonesia and at least six other countries next year. The company has been laying off staff after the phone it bet its future on, the BlackBerry 10, failed to wow consumers. And Windows Phone has surpassed it in market share. Chen says its $3.2 billion in cash will allow BlackBerry to turn itself around. But RBC analyst Mark Sue said, "Cash burn implies more layoffs to come. Lack of clear strategy to weigh on shares." One thing BlackBerry had prided itself on was its rich patents, which rivals Apple and Microsoft were once interested in buying. But its balance sheet shows that in just nine months, its intangible assets, which includes patents, have shrunk to less than half.