BlackBerry to Fire 4,500 Employees as Sales of New Device Plummet

BlackBerry confirmed it was firing 4,500 of its staff on Friday as the struggling smartphone firm said it expects to lose nearly $1bn in the three months to August on disappointing sales of new phones.

Revenues for the three months were only $1.6bn, the company said, against analysts’ forecasts of $3bn – indicative of a collapse in its business after lacklustre sales of its new Z10 and Q10 phones. In all, it shipped 3.7m smartphones in the quarter, its lowest since summer 2007, when the first iPhone came out.

The company’s shares crashed from $10.20 to $8.03 before recovering to $8.73, a 17% drop on the day, valuing it at $4.5bn. The shares were briefly suspended as rumours of the loss circulated, and it was forced to indicate its quarterly earnings a week ahead of their scheduled date. It said it would announce a loss of between $930m and $955m next week.

That brings its total losses in the past seven quarters to $1.8bn, putting its viability as a going concern into question.

The company announced it was putting itself up for sale at the end of August – which market observers took to indicate it had failed to find a buyer privately. Microsoft’s acquisition of Nokia this month effectively left the Ontario-based company in the cold.

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