The news from BlackBerry is coming so fast and furious it’s hard to keep abreast of it. It’s mostly looking like freefall.
In advance of the 3rd quarter results — and hinting at the news – Rick Costanzo, executive vice-president of global sales, and Chris Wormald, vice- president of strategic alliances, fled the company, presumably to avoid the knife. BlackBerry’s director of global public policy, Mark Cameron, has announced he is joining Hill + Knowlton Strategies Canada as a practice leader. These join Frank Boulben and Kristian Tear who were sacked following John Chen’s taking over as interim CEO in November (see Blackberry’s Chen is pushing hard to turn the company around).
Chen has tapped new talent to try to recover: John Sims will join BlackBerry as head of its global enterprise services business, leaving SAP where he serves as president of the company’s mobile services business. Chan also tapped two of his former colleagues from SAP and Sybase: James Mackey will become executive vice president for corporate development and strategic planning. He led corporate development at SAP where he worked with Chen. Mark Wilson was named senior vice president of marketing, after leading marketing at Avaya, after working for many years at Sybase.
And then this morning, the quarterly results. Ka-boom.
A massive $4.4 billion quarterly loss, largely as a result of a huge write-down of assets, inventory, supply commitments, and a previously announced restructing. Chen is trying to get as much of the mess behind him, all at once. But there is systemically bad news and good news in there too. First, 1.9 million handset sales were only 40% of revenues, down from 49% last quarter. However, the company announced that 40 million new users of BBM have signed up since the company released Android and iOS versions of the app.
The market responded to the news — and the fact that BlackBerry burned through $400 million in cash, less than expected, and still sits on $3.2 billion in reserves — by driving up the stock 3%.
Chen projects a turnaround in the new year, and he may be able to pull that off if these new hires can make things happen. As I have said, there is still room for them in the market, especially if they can get people using the technology on Android and iOS.