BlackBerry loses its bread and butter as Bold and Curve sales finally collapse
In commercial terms, BlackBerry's much-hyped BB10 phones barely made a dent. The manufacturer's financial health has actually been propped up this whole time by sales of its older classics, Bolds and Curves running on BB7. It's pretty incredible how long those models have lasted, but BlackBerry's latest earnings report reminds us that nothing lasts forever: BB7 sales have fallen 50 percent year-over-year to 2.3 million units, which is double BlackBerry 10 sales, but not nearly enough to help the company stay in the black. Of course, the collapse of legacy hardware isn't news to the CEO, John Chen, who has promised to support BB7 devices "for as long as there's demand," but who has also set about rebuilding BlackBerry as fast as he possibly can.
Fortunately, the earnings report also gives us a glimmer of hope for Chen's efforts: 54 percent of revenue is now coming from selling services rather than phones, and Chen also claims that BlackBerry has achieved its "expense reduction target" a whole quarter ahead of schedule. The CEO says he expects the company to be profitable by 2016 if it can succeed in providing secure communications for large corporations and government agencies. He also said there are plans for further smartphones, going back to BlackBerry's business-focused and QWERTY-equipped roots, but right now that still seems like a long shot.
Additionally, Chen also mentioned in this morning's conference call to investors that BlackBerry will continue production of the BB7-powered Bold with a new manufacturer. Wistron will be in charge of the next production run, he says, ensuring that the phone is no longer sold at a loss. He also told Reuters that three different devices are "being kicked around" right now, and that there will be more of a keyboard-centric focus on those products.