BlackBerry Ltd Dismisses Reports that it would Soon Depart from Consumer Market
Not surprisingly, BlackBerry Ltd has denied speculations that it would soon pull out of the current consumer market. During the launch event in London of its new flagship smartphone Z30, BlackBerry representatives vehemently denied those reports, describing those rumors as misconstrued information by analysts and the media.
The company disclosed that most of its customers are market consumers. It reiterated plans to stay in core market areas around the world. However, it recently streamlined its portfolio to focus on just four core handsets that operate on its latest mobile operating system, BB 10. Those are the newly launched Z30 and older models Z10, Q5, and Q10.
Troubled Canadian company
The issues that BlackBerry is currently facing are considered as open secrets in the industry. For some time now, the company has been incurring weak sales of most of its new devices. It even posted a huge loss for its second quarterly results, which was mostly dragged down by a $995 million write-down on unsold devices.
The market capitalization of BlackBerry also continues to dwindle as time goes by. To illustrate, the company was worth $83 billion in 2008. Currently, its value is estimated to be worth just $4.7 billion. It is expected to post further losses in the coming quarters if it still fails to mark a turnaround on sales of smartphones. Thus, it does not surprise anyone that the company is set to layoff up to 40% of its workforce globally by May next year.
Process of selling
Several months ago, the Canadian smartphone manufacturer has announced its willingness to explore several options to save its business. Those include selling out itself to potential buyers and spinning off some of its units. Just recently, it has already agreed to be acquired by a consortium led by fellow Canadian firm Fairfax Financial Holdings Ltd.
At present, due diligence is being observed before the deal finally gets final and complete. That long and tedious process is set to be concluded on November 4. Until then, BlackBerry and its prospective buyer would have to remain silent about any update regarding the possible transaction.
According to sources, BlackBerry would continue to operate its business if it would be acquired by its bidder. In fact, the company is expected to be better off financially once that happens. For now, the company and its shareholders have to wait for the outcome of the due diligence.