It’s over: Blackberry is leaving the consumer market

September 20, 2013

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Today, Blackberry released their preliminary financial results for the second quarter of the fiscal year 2014, and it’s worse than imagined. While nobody believed BB10 would fully resurrect the once mighty smartphone company, nobody expected operating losses approaching $1 billion, either.

According to the press release, BlackBerry will be “refocusing” on enterprise and end-to-end solutions. They’ll also trim their lineup from six devices to four, with two high-end offerings and two lower-specced phones. This effectively means that BlackBerry is giving up competing in the consumer market and will try to survive as a niche player in enterprise.

Blackberry will also cut 4,500 jobs, and attempt to reduce their operating expenditures by 50% before the end of Q1 FY 2015.

In addition to the operating loss of $950-995 million, the Waterloo, Canada company will also see a pre-tax inventory charge of $930-960 million, primarily attributable to Z10 devices. Blackberry did make $1.6 billion, of which half is service revenue, and expects to see revenue on 3.7 million smartphones, primarily BB7 devices.

The company expects their adjusted net loss to hover in the $250 million range, or about $0.50 per share. At the time of writing, Blackberry stock is currently trading at $8.73, and has fallen $1.80 on the day, which is more in tune with their GAAP loss of $950 or so.

This marks an end to Blackberry’s consumer presence, and a sad exit for a once prominent and ubiquitous company. While the enterprise market got them to where they were, programs like BYOD and Apple’s increasingly strong presence in enterprise will prove difficult. Google is also pushing hard, and has many top-tier companies “going Google”. Blackberry may find sourcing contracts for enterprise or government difficult in the current landscape.

It seems even the most obvious solutions for survival may no longer be viable for Blackberry.

Now read: Switching from Blackberry to Android: your guide

Comments

  • Jin

    we all know it was going to happen

  • Laurence Eckert

    Blackberry never had a chance, coming so far back into the game, a few years ago they could have made a comeback but not now, in 2013.

  • Tochi Obudulu

    It wasn’t if; it was when..

  • Fluffy

    Just wait a few months and the law suits will start to pick over the corpse just like what happened with Kodak

    • SupraTico

      What lawsuits? BlackBerry doesn’t have any debt, thus no creditors, and no lawsuits.

      • gommer strike

        No one should care about the consumer market. Only the enterprise matters. People who buy Android/windows/iOS are just child-men who buy shameful TOYS. TRUE business men – the one percent who actually MATTER, buy blackberry.
        Closers use Blackberries. Anything else, you’re a poser. The one percent have spoken. So take your toy phones and shop at Walmart, while the elite amongst us employ you as SERVANTS to do our shopping for us, while we get REAL business done on our blackberries.

        • Nickan Fayyazi

          Oh no, you’re so macho with your physical keyboard…

          If real businessmen use BlackBerry, why do the top companies and top executives use/make Android and iOS?

          • gommer strike

            keke sorry about that!

        • OBree_Rock

          How cool your android is a complete statement of your dick. Mine is old but im planning to get a upgrade. But with that said, its a complete ode to your personality

          • gommer strike

            relax. It was meant to be sarcastic

          • idiotseverywhere

            he just doesn’t know how to read one. don’t get mad, just be silly. :)

      • Fluffy

        http://www.reuters.com/article/2013/03/30/us-blackberry-lawsuit-idUSBRE92S0HI20130330 read this , blackberry won a huge lawsuit saying that it wasn’t covering up huge losses , if i was one of the shareholders i would definitely reopen the case as they obviously were!

  • Anon

    Well it took you long enough!

  • Luka Mlinar

    I don’t get why they kept going the same old direction even though everyone knew it would lead to their undoing. I just can’t get over that.

    • BDPSU

      Arrogance.

      • theotheruserishere1

        and why they kept making so many old shitty phones!!! why would you keep making a phone which is based on a 2007 or 2008 system?!!?!??!?

  • Rauel Crespo

    I’d bet that if they did their own version of Android (like Amazon did with the Kindle Fire) that supported BBM, they would be in a polar opposite situation right now….I could have run that company better…In fact, most people reading this probably could.

  • BDPSU

    LOL Failberry. Their management did this to them.

    • MS is a dead issue

      Microsoft better take this as an eye opener. They could easily be next the way they kick their customers in the scrotum. Windows 8 reception…especially in the enterprise, Windows Mobile/Phone poor reception, Xbox One Pre Release Scrutiny leading to back pedaling and damage control. . At least Steve is on his way out.

      • OBree_Rock

        Down with Microsoft. But I will keep their office apps (that shit is my life)

      • Michael

        Microsoft have enough fingers in enough pies to persist. RIM doesn’t, really. MS are in the incredibly situation of being able to have flops as massive as WIndows 8 makes relatively no impact.

  • Eric Jaeger

    Still don’t understand why they won’t just sell the BES functionality on Android and iOS. BB Email, Calendar, Contacts, and Messenger are unquestionably the best for enterprise use. I’d likely pay $99/yr for BES over what is available on Android today.

    • gommer strike

      I think they’re going to have to, if they haven’t already started development efforts towards that.

      The problem is that now, there’s so many MDM solutions available now, eg. Maas 360, Good for Enterprise, and other mobile VPN or all-in-wonder solutions which encrypt corporate traffic/data between your smartphone and corporate email.

      But if Blackberry can come out with their own all-in-wonder suite of Mail, Calendar, and Contacts which support BES for iOS/Android, they would wreck face. Honestly when you look at many of the all-in-one stuff out there, it’s pretty mediocre. Good For Enterprise is just god awful. TouchDown for Smartphones(Android) is…so-so…not awesome…not horrible.

    • LOLBaltSS

      I cannot speak for all IT Admins, but killing off the BES server when we stopped using the Tour was a good day here.

    • Zhakrin

      The new version of BES includes support for iOS and Android phones. They also just (tried to) release BBM for android and iOS as well

  • seyss

    killed by apple. android is next.

    • AppDroidple

      whoa look out! Troll just walked into the house

      • Kash Gummaraju

        Actually Apple started the killing process with the iPhone, but then Google and Microsoft joined. And then Google dominated them all and headed Blackberry’s death.

    • jeremy

      Apple will not be killing android anytime soon. Android dominates in every market and they have almost every single manufacture under their belt. For android to fail. Every single company using the os would have to find an alternative or create their own…… Just not going to happen

      • HelloMottoKitty

        Yeah your right, Apple will have to chew through 22+ companies to kill android, some of which are companies way Larger than Apple

    • Clarkkent113

      You’ve got that backwards. If anything Google is the one company that could kill Apple in the long-term. Between Android, cloud-services, and the growing usefulness of Chomebooks Apple could be in serious trouble within 5-7 years.

      • Nick b

        Not if applekeeps copyiabdroid. Lol

    • gommer strike

      Actually if you take a step back and look at it more impartially –

      Wanna know what *actually* killed Blackberry? It’s not iOS nor was it Android. It’s Microsoft. Here’s why.

      Blackberry was the KING of the Enterprise, for years upon years. Nothing came close. Until a little company called Microsoft came out with a functional Exchange Activesync. Prior to Activesync, the *only* real feasible way to get your corporate email on the go, was to have a Blackberry…full stop.

      Then Activesync came into the picture and ruined everything. Sure it didn’t have the encryption and awesome security of BES. Sure it didn’t automatically process Office documents and PDF’s and simply send you the raw data. But it DID enable emerging, primitive Windows smartphones(if you could call them that), to get email on the go.

      Then Microsoft did something unprecedented(and honestly, they really didn’t have to do this). They opened up Activesync and allowed iPhones and phones from other manufacturers to hook into Activesync. This honestly, was the beginning of the end for Blackberry. This is the ironic(?) thing. If only Microsoft locked Activesync to *only* Windows Phones, then iPhone/Androids would be only usable in the consumer space and be nowhere near business-class devices.

      • APai

        oddly, android did it without office & activesync, google swept the consumer market before microsoft even blinked!

        • gommer strike

          Prior to Activesync, how did Android devices sync with Microsoft Exchange(over the air)? We’re not talking about syncing with Google. We’re talking about syncing against your corporate email server back in 2007.

      • Apple_Nexus

        Who do you think you are, coming in here knowing what you’re talking about?

        This is a place to bash Apple and worship the messiah’s second coming, also known as Kit Kat!!

        • gommer strike

          we can’t have…logical sounding statements like what i said above! definitely not welcome ’round these parts

      • A Griffith

        Thank you for being the only knowledgeable person on why BES has been doomed for half a decade or more… Frankly the average enterprise, government and financial sector withstanding, doesn’t give a shit about secure mobile device management. Blackberry shouldn’t have assume companies knew what they needed with MDM.

        You know how many times I got a call from a Blackberry rep about installing BES before I sought it out and set it up for my current company… zero calls. Its really easy to not use Blackberry if you aren’t already invested in the BES ecosystem. That and BES Express was free and easy to dump for iOS/Android/WinMo products.

      • Nick Jennings

        Very well put. Makes me happy to see knowledge on here.

    • Alex

      You mean killed by Android apple is next…

    • ab__cd

      Killed by Apple by about 1%, then the rest by Android.

    • Kash Gummaraju

      don’t know if you’ve been paying attention to apple’s decisions and products, but you can tell they’re running out of innovative industry changing ideas. The fingerprint scanner is possibly that last innovative idea that came out of Apple. To kill android, Apple would have to have iOS run on cameras, watches, eyewear, refrigerators, and a lot more appliances and devices in order to compete with Android in its application diversity. And to do that either Apple will have to make those devices on its own or make iOS open source-which we know Apple will never do-.iOS only runs on the iphone,ipad,itouch, and nothing else and mac OS runs solely on macbooks,and mac desktops. Android runs on a variety of things not just phones and tablets. So in order to kill android ,Apple will need to destroy the 100s of companies that use android in their products. The 5S and 5C are Apple’s last real stand, now they’re going downhill slowly much like Blackberry.

    • Aris Routis

      That was… um. Funny. yeah.

    • totalsmoshy

      Ummmm no….. Unless you were being sarcastic. Android is doing well, I think better than apple. The only way Android could die is if they made a terrible mistake.

  • Taylor Ducote
    • Bill Hill

      prob bad use of this gif lol

  • jjordan

    On the day they announced the Z30…if they would have just abandoned that gesture based OS and went with an android comeback or I can’t believe I’m saying this but blackberry is the 1 OEM that could have worked out a deal with apple to run some kind of customized version of iOS on there devices.

    • gommer strike

      You can’t work out a deal with Apple to license iOS. The good ol’ days of Apple licensing out their operating system died in the late 80’s to early 90’s.

      But they could have definitely used Android, Firefox Mobile OS, or any of the other mobile choices that are slowly making themselves known.

  • Balraj

    Android to blame?
    After android came,many big companies got screwed lol

    • gommer strike

      When Android first made it’s debut very early on, the OS was relatively unremarkable at the time. It wasn’t until roughly Gingerbread era, that finally the OS began to slowly hit it’s stride. These competitors could have taken those moments of weakness and growing pains to exert their influence, but they did not.

      • Balraj

        Only after Google bought it
        It evolved…Google did a simple job..make it open source
        That was enough to kill few companies
        And ya..competitiondid not take android seriously like you said

      • Matthew Wypyszinski

        That seems to be a recuring story throughout the business world though. Frequently the mega companies we see today were at one point offered for sale to companies are now their chief competitors (and are frequently left in the dust). It happened with coke and pepsi, yahoo and google.

      • Cristi13

        In 2010, when gingerbread was released, android was becoming the most dominant platform on smartphones, overtaking symbian.

    • Iskandar

      Like Walmart

  • gommer strike

    And you know something? Someone, somewhere, is *still* going to be saying

    – “Blackberry has NO DEBT, I repeat, NO DEBT. They are going strong”
    – “They make the BEST PHONES PERIOD.”
    – “Don’t believe the lies. Blackberry is unstoppable, and will show their muscle where it COUNTS – the enterprise. Nothing else matters.”

  • NeedName

    The QNX platform for the new BB OS is actually very very good. . . much better than anything else in the mobile space at this point in time. . . sad it ended up at BB.

    • gommer strike

      VHS vs Betamax…sometimes the superior tech doesn’t win.

  • Alex

    Surprise Really …. Android will take over the world …Apple you are next…

    • TheAppleFanatic

      Not really, every iPhone release has broken the previous versions sale records.

      The only thing Apple is doing wrong is not having an iPhablet, or a 4.5″ iPhone.

      • Jarret

        Apple’s iPhone only makes record-broken sale at the release launching day…After that, the sale number getting down. Samsung Galaxy/Note sale number always more stabil at every single day…Sure!

        • TheAppleFanatic

          The iPhone 5 outsold both the GS3 and the GS4.

          • Jesus

            Source? Or is that out of your Apple Ass again?

      • Conal Hendry

        haha! and the fact they have no removable batteries or the capacity to expand storage!! apple is a fad… granted, millions have followed the trend but as android phones continue to add groundbreaking features you apple users will be left behind

        • TheAppleFanatic

          Many android phones don’t have either of those but B0T602TS don’t care, because they are fanboys

          • Conal Hendry

            You’ll find most do… Only the HTC one and Experia z don’t have removable batteries.. Do your research dumbass.

          • TheAppleFanatic

            Only android phone with a removable battery are Samsung phones.

          • Suka Nuro

            My LG Optimus 4x has a removable battery
            So did my LG Optimus 2x
            And my Huawei Ascend G600
            And my brothers’ old little Huawei phone

          • L

            My Sony Xperia Mini Pro also has removable battery.

          • BDPSU

            Nexus devices too.

          • Nick Jennings

            Thats it? Your the dumbass! Do yor research. What about the razr?

      • nevermore

        iPhabet ? that was a little funny

      • Matthew Amezcua

        Apple does have great sales, but they do have to be careful. Just like Blackberry, apple refuses to change. If they keep this up they’ll be in the same situation as Blackberry, or maybe even worse.

      • Kraynyan

        you mean copying any company that releases with an android OS?

  • Grman Rodriguez

    None of this would have happened hadn’t BB been so unresponsible, the Z10 would have had nice specs for the time it was supposed to be released. But on January 2013 it was underwhelming. And all the cool features were introduced by the competition earlier. That year where they released nothing (2011 I think) also doomed them. And BBM also got delayed long time and we might not enjoy it for much time. I would have liked to see BB rise again to the top but with the way they took the challenge I can’t say I’m not disappointed. This is sadly another company to be once on the top and now dead. Siemens 2.

  • Farbod

    make an article about how the apple a7 stacks up against the qualcomm snapdragon 800. i would like to know. does anyone know already?

    • not a spark

      Very close

    • lesportif

      A7 performs better in CPU tests and about the same in GPU. 2 cores @ 1.3ghz superior to 4 @ 2.3Ghz. Apple is doomed ;-)

      • Jimbo

        Unfortunately true. Check out Anandtech.
        What is going on…What to rub how crap Apple is in people’s faces!!

  • deepen03

    Good riddance!

  • Ryan Castle

    Blackberry, if you released your BB10 in 2010 or even 2011 you would’ve had a chance, but no.

  • Laborin_HK

    Now google… buy blackberry >:) MONOPOLY

  • Zack

    Now we know the reason why BlackBerry will launch BBM for iOS and Android..

    • BDPSU

      and no one cares.

      • Zack

        Yeah :/

  • John-Phillip Saayman

    I’m not sure I understand. They are over but still going to make devices?

    • OBree_Rock

      keyword here: consumer

      • John-Phillip Saayman

        So perhaps after the Z30 and Q5 no more Blackberry devices for consumers?

        • idiotseverywhere

          they would continue to make phones as stated in the article. 4 phones in total, 2 for the high-end and 2 for lower-end. i just don’t think they would continue developing new phones, but will stick to their old phones until they become old and die and be gone in this world.

  • poohman

    The BB10 based on QNX was not actually a bad idea. The microkernel architecture matches Blackberrys requirement perfectly and they took their time to offer a quality product. The only catch was when the Z10 got released it was low specd and costed crazy. Had they got their costing right, things would have been different. They still have a good following in Asia, but the Asian market is pretty cost conscious. Even now the Z30, with the right costing could be a game changer.

  • pissflaps

    so when are cyanogen going to port android for the playbook?

  • OBree_Rock

    Am I the only one who feels Microsoft ripped BB place in competition.

    Crowded markets g

  • Leonardo Rojas

    I’ve never liked Blackberry, but this happening is sad because of the several thousand families that will lose their source of incomes; the dads and moms that worked there :(

  • shamatuu

    They were done before they started. not so shocking at all.

  • Aaron Starr

    Blackberry had a chance to come back.. but they decided to release the 9900 and push back Blackberry 10 a full year. If they would of had done what Google and Apple was doing it would of had been great

  • susana

    I guess it’s kind of inevitable that BB fails like this since it obviously offers less than androids and ios. But I really want a diversity of phone styles. If no one has noticed…. they are all pretty much a huge rectangle block with a huge rectangle screen. And that’s it. I miss when there were flip phones and slide phones and those open phones and the blackberry style. I bought the 9930 like 6 months ago and I’m pretty satisfied with it. I switched to a BB for a reason. I was tired of the touch screens. Samsung came up with that half flip phone, half smart phone but they don’t even sell them in America. With BB failing, I feel like there’s even less choices in the phone market. Quite disappointed.

    • hyperion5

      Uh, you do realize that their consumer product was also a huge rectangle screen and that’s the one that failed? In other words, as they remain in the business market, the phones with keyboards and perhaps other form factors may remain. Their foray into the consumer market did not increase your choices of hardware types really.

  • smokebomb

    They put all their eggs in the BB10 basket. They should’ve dropped out of hardware completely a few years ago and done something with their software to make it available on iOS and android. Then eventually they could’ve made a comeback.

  • EvenInTheDarkestHour

    Still a viable business device. Just not mainstream consumer friendly. They should have merged/sold when there were buyers…hindsight and all…

  • http://www.davethewebguy.com/ David Pinero

    But I wonder when they say they will continue to compete as niche players in the “enterprise” market, what exactly are they talking about? Doesn’t everyone in the enterprise use a competing smartphone already?

    • BDPSU

      They have no clue what they’re going to do.

  • http://bubbytimes.blogspot.com/ greedoe

    Here’s hoping for new sponsorship ads on Sky Atlantic!

  • Angino

    Blackburied now.

  • bt

    Blackberry are finally gone. It is a shame, I suppose, their old products were suited to many people, but trying to turn into Android didn’t work out for them. Abandoning the whole idea of Blackberry was their real downfall.

    • BDPSU

      Not really. They abandoned the “whole idea of Blackberry” because people no longer wanted that. What hurt them was waiting too long to change. They should have reacted to the threat of iPhone/Android much sooner. By the time they did something, it was too late.

  • BDPSU

    Fail phone.

  • Eddie O’Connor

    Its too bad they didn’t even TRY for the tablet market…I’m sure they might have had a chance if they offered an “alternative” to the Google Tablets and the Apple iThings!..who knows?….they might have even been able to approach Microsoft on that front?…but I guess we’ll never know…unless someone steps in and infuses new blood into their dying company.

  • Nick Jennings

    I remember having BB. Such an awesome phone at the time. The Pearl was sweet. I hope BB can stick it out. A tablet line would probably help.