Blackberry reports £603 million second quarter loss

Blackberry has reported a second quarter net loss of £603 million following a slump in sales.
The company warned investors last week that it would report a loss of up to a billion dollars, due to poor sales of its new smartphones.

It also announced 4,500 job cuts in a bid to stem those losses.

Earlier this week Blackberry agreed to be bought by a consortium led by Fairfax Financial, its biggest shareholder, for £2.93 billion.

Blackberry said it would continue to explore other options while negotiations with Fairfax continued.

The company’s financial problems came to a head this year following disappointing sales of its new Z10 smartphone.

Sales were so poor that Blackberry had to write off £583 million in the second quarter to account for the weakness.  Released in January – after many delays – the phone has failed to enthuse consumers.

The firm reported total sales of £1 billion compared with £1.94 billion in the same quarter of 2012- a near 50% fall.

“We are very disappointed with our operational and financial results this quarter and have announced a series of major changes to address the competitive hardware environment and our cost structure,” said Thorsten Heins, Blackberry’s chief executive.

In the second quarter, Blackberry said it sold 3.7 million Blackberry smartphones- which compares with 7.4 million shipments in the same period of 2012.

To put these sales figures into perspective, Apple sold 9 million of its new iPhone 5S and 5C smartphones on the opening weekend of sales earlier this month.

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