Is the worst over for BlackBerry?
After three years of layoffs it’s too early to say. However, in an Aug. 1 memo to staff, CEO and chairman John Chen tried to reassure staff that there are no more planned cuts.
“We have completed the restructuring notification process, and the workforce reduction that began three years ago is now behind us,” the Reuters news agency quoted the memo as saying.
On the other hand he added a qualifier: barring any unexpected downturns in the market.” Otherwise he said, BlackBerry will be adding employees in product development, sales and customer service, “beginning in modest numbers.”
The total workforce has shrunk by 60 per cent over the last three years as the Waterloo, Ont., company faced plunging sales, with buyers turning to Apple’s iPhones and smart phones running the Android operating system.
An attempted turnaround by Thorsten Heins, who was betting the release of the all-touch BlackBerry Z10 would lead to a sizable boost in sales was deemed a failure last November. He was replaced by Chen, who decided the company had to get out of non-core areas (like handset design and consumer apps) and focus on its core enterprise buyers for the time being.
In June, just after the company announced it came to a deal with Amazon to stop developing consumer apps, BlackBerry closed its developer relations group and let 65 people go.
But Chen also decided — for the time being — that BlackBerry was no longer looking for a buyer.
One result of the cuts is that Chen believes the company will be cash flow positive by the end of the current fiscal year (next spring), and profitable after that. During its last quarterly financial report, Chen told financial analysts the company is “firmly on track to achieve important milestones.” While it had only $996 million in revenue, it also lost only $60 million in the quarter.
This fall will see three key product releases: the Passport, a handset with a 4.5-in square screen and physical keyboard; the BlackBerry Classic, which runs the new BB10 operating system but includes the trackpad demanded by older BlackBerry owners; and BlackBerry Enterprise Services (BES) 12.
BlackBerry’s next quarterly report will be Sept. 26 for the quarter ending Aug. 30.
Separately, the company said today that its containerization solution within BES 10 for iOS and Android devices — called Secure Work Space — has received Security Technical Implementation Guide approval from the U.S. Defense Information Systems Agency. The approval is another lever BlackBerry can use in trying to convince governments and enterprises that BES is the most secure mobile management platform for organizations that allow staff to use BlackBerry, iOS and Android devices.
While Secure Work Space allows organizations to put corporate data in a secure spot on iOS and Android devices, BlackBerry says its handsets offer better encryption.