BlackBerry released its preliminary second quarter financial results today, and as jargon-y as that sounds, the company dropped some major bombshells.
We'll start with the news that affects consumers directly: BlackBerry has decided to chop its future smartphone portfolio from six devices to four. Cost-saving measures are to be expected, but there's more.
The phone maker will now focus on making "enterprise and prosumer-centric targeted devices," producing for that space two high-end devices and two entry-level devices. All-touch and QWERTY models are in the offing, but the days of BlackBerry ardently plying phones to consumers are over.
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"We are implementing the difficult, but necessary operational changes announced today to address our position in a maturing and more competitive industry, and to drive the company toward profitability," CEO Thorsten Heins said in a BlackBerry press release.
"Going forward, we plan to refocus our offering on our end-to-end solution of hardware, software and services for enterprises and the productive, professional end user."
BlackBerry reiterated a special committee continues to explore strategic alternatives for the company's future, which it has stated includes an all-out sale.
Of course, BlackBerry wouldn't just up and decide to shift its attention to the enterprise and prosumer space. It would have to be losing bucket-loads of money. Well, it is.
According to the company's preliminary calculations, it expects a net operating loss of approximately $950 million to $995 million for the second quarter, or about £592m/AU$1.01b to £621m/AU$1.05b.
A huge portion of that - $930 million (about £580m/AU$988m) to $960 million (about £599m/AU$1.02b) - is a primarily non-cash, pre-tax inventory charge "resulting from the increasingly competitive business environment impacting BlackBerry smartphone volumes."
That's the nice way of saying the Z10 didn't sell, and now BlackBerry is sitting on a mountain of unsold BlackBerry 10 handsets. A $72 million (about £44.9m/AU$76m) restructuring charge is also in there, as well.
Cutting even deeper to the quick, BlackBerry's restructuring will result in the lay off of 4,500 employees, or about 40% of its workforce.
As for whatever positives there are, BlackBerry expects to pull in second quarter revenue of $1.6 billion (about £998m/AU$1.7b) and sales of 3.7 million smartphones. Sadly, most of the smartphones recognized in that figure run the older BlackBerry 7 OS. The company won't count shipped BB10 devices until they're sold to consumers.
The measures it's taking are done in the hopes BlackBerry can shrink its operating costs by about 50% by the end of the first 2015 fiscal quarter, though whether there's a BlackBerry to report financials on by then remains to be seen.
The company is due to discuss final Q2 2014 results on Sept. 27.