From the “It’s about time” department comes this announcement from BlackBerry they plan to end all internal hardware development. Meaning that they won’t be designing smartphones anymore. Instead, their partners will develop hardware. This fact was taken from their Q2 results [Warning: PDF] that came out today:
“We are reaching an inflection point with our strategy. Our financial foundation is strong, and our pivot to software is taking hold,” said John Chen, Executive Chairman and CEO, BlackBerry. “In Q2, we more than doubled our software revenue year over year and delivered the highest gross margin in the company’s history. We also completed initial shipments of BlackBerry Radar, an end-to end asset tracking system, and signed a strategic licensing agreement to drive global growth in our BBM consumer business.”
“Our new Mobility Solutions strategy is showing signs of momentum, including our first major device software licensing agreement with a telecom joint venture in Indonesia. Under this strategy, we are focusing on software development, including security and applications. The company plans to end all internal hardware development and will outsource that function to partners. This allows us to reduce capital requirements and enhance return on invested capital,” continued Chen.
That ties into this press release that also came out today:
BB Merah Putih will source, distribute and promote BlackBerry-branded devices that use BlackBerry’s secure Android software and applications. BB Merah Putih will have full access to the BlackBerry experience, which includes the trusted BlackBerry for Android secure software, for production of new devices in Indonesia. The joint venture was created in support of the Indonesian Government’s efforts to promote the development, manufacturing and creation of locally sourced products, while also increasing the number of value-added LTE smartphones available and sold in the country. It is being led by PT Tiphone Mobile Indonesia Tbk, a leading telecommunication company with the largest distribution network in Indonesia. PT Tiphone is an affiliate of PT Telekomunikasi Indonesia Tbk, which is the largest carrier in Indonesia. The JV and its affiliates account for nearly half of the total Indonesian mobile market.
At this time you have to wonder what Jim Balsillie and Mike Lazaridis are thinking as those two built this business on both hardware and software. I will say that what Chen is doing is likely the right decision and is long overdue. But those two gentlemen may have different feelings on that.
But I digress.
Seeing as this info came out as part of their earnings report, I suppose I should mention that. The company had a $372 million USD net loss in the three months ended Aug. 31, equivalent to 71 cents per share, but broke even after excluding certain items. Revenue was $334 million USD or $352 million USD after adjustments. That was below analyst estimates of $391.75 million USD. Read into that what you will.
BlackBerry To End All Internal Hardware Development
Posted in Commentary with tags BlackBerry on September 28, 2016 by itnerdFrom the “It’s about time” department comes this announcement from BlackBerry they plan to end all internal hardware development. Meaning that they won’t be designing smartphones anymore. Instead, their partners will develop hardware. This fact was taken from their Q2 results [Warning: PDF] that came out today:
“We are reaching an inflection point with our strategy. Our financial foundation is strong, and our pivot to software is taking hold,” said John Chen, Executive Chairman and CEO, BlackBerry. “In Q2, we more than doubled our software revenue year over year and delivered the highest gross margin in the company’s history. We also completed initial shipments of BlackBerry Radar, an end-to end asset tracking system, and signed a strategic licensing agreement to drive global growth in our BBM consumer business.”
“Our new Mobility Solutions strategy is showing signs of momentum, including our first major device software licensing agreement with a telecom joint venture in Indonesia. Under this strategy, we are focusing on software development, including security and applications. The company plans to end all internal hardware development and will outsource that function to partners. This allows us to reduce capital requirements and enhance return on invested capital,” continued Chen.
That ties into this press release that also came out today:
BB Merah Putih will source, distribute and promote BlackBerry-branded devices that use BlackBerry’s secure Android software and applications. BB Merah Putih will have full access to the BlackBerry experience, which includes the trusted BlackBerry for Android secure software, for production of new devices in Indonesia. The joint venture was created in support of the Indonesian Government’s efforts to promote the development, manufacturing and creation of locally sourced products, while also increasing the number of value-added LTE smartphones available and sold in the country. It is being led by PT Tiphone Mobile Indonesia Tbk, a leading telecommunication company with the largest distribution network in Indonesia. PT Tiphone is an affiliate of PT Telekomunikasi Indonesia Tbk, which is the largest carrier in Indonesia. The JV and its affiliates account for nearly half of the total Indonesian mobile market.
At this time you have to wonder what Jim Balsillie and Mike Lazaridis are thinking as those two built this business on both hardware and software. I will say that what Chen is doing is likely the right decision and is long overdue. But those two gentlemen may have different feelings on that.
But I digress.
Seeing as this info came out as part of their earnings report, I suppose I should mention that. The company had a $372 million USD net loss in the three months ended Aug. 31, equivalent to 71 cents per share, but broke even after excluding certain items. Revenue was $334 million USD or $352 million USD after adjustments. That was below analyst estimates of $391.75 million USD. Read into that what you will.
Leave a comment »