BlackBerry swings back to profit despite shrinking subscriber base

By on March 28, 2013, 3:00 PM

The future of BlackBerry as a relevant player in the modern smartphone market largely hinges on its newly released operating system. So how are things looking roughly two months after launch? Not great, but not nearly as bad as they were just a few short months ago, either. There are some positive signs of improving financial health as the company continues to rollout its full touchscreen Z10 handset globally.

During an earnings call for its latest quarterly financial results, the Canadian firm reported a surprise profit of $94 million on revenue of $2.7 billion. As much as 61% of the revenue generated during the quarter was from handset sales, with the remaining 36% coming from service fees and 3% from software and other services.

Handset shipments totaled 6 million, missing the 6.9 million estimate, although the gap was narrower for the Z10 in particular with 1 million units ‘shipped’ versus the 1.1 million forecast. It’s unclear how many of those were actually sold to end users since BlackBerry doesn’t report this data. The phone went on sale in the U.K. on January 31, in Canada on February 5, and then across Asia and Europe in the following weeks.

The BlackBerry Z10 didn’t arrive in the U.S. until last week through AT&T, Verizon and T-Mobile.

BlackBerry service subscribers decreased 3 million to 76 million. The company said the bulk of its customer losses could be attributed to prepaid subscribers switching away from its platform. CEO Thorsten Heins was optimist, though, noting that 55% of Z10 customers globally are coming from platforms other than BlackBerry. He also talked up the fact that they’re starting to see the benefits of a cost-reduction program launched last year, and claimed that they’re seeing “a new attitude and a cultural shift in the company.”

Besides discussing financial results the company also announced that Mike Lazaridis, co-founder and former co-CEO will be stepping down as a director and vice chairman of BlackBerry by May 1.




User Comments: 9

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killeriii said:

I'm impressed!

I didn't think they had a chance. Good to see them making progressive changes that are working for them and their customers.

m4a4 m4a4 said:

I wonder where those trolls are now :P

Littleczr Littleczr said:

I love their keyboard, I wish android had it.

psycros psycros said:

The problem is that BB Inc released the wrong model first. The entire BB loving world has been eagerly awaiting a new, modern QWERTYphone..and instead the geniuses at Waterloo decided to pursue the iPhone and Android users first. Might have been a decent plan if the Z10 had a single compelling feature to lure customers to BB. The usability is mixed at best - the gestures aren't well implemented or intuitive. The UI is too Android-like, I.e. busy and overwrought. They needed a home button at the very least but instead we get magical morphing touchscreen insanity. The graphics are typically downbeat and reserved like everything BB Inc produces so it scores no points on eye candy. All told, not only is the Z10 worthless to those who need a real k/b and highly functional smartphone, its not one bit attractive to veterans of other platforms either. Could BB still pull out of this nosedive? Sure..by adding a virtual trackpad to the Q10 when it finally arrives. They should also design a mid-level BBOS 10 device with a keyboard *and* at least one hardware button on the front (preferably a trackpad/clicker.) A new "Curve" would sell like mad in developing nations and do pretty darn well in other markets, too.

psycros psycros said:

Meant to say, "by adding a virtual trackpad to the Z10 and the Q10". Maybe someday TechSpot will become a real site with comments you can edit. Perhaps they'll even outgrow their suddenly acquired fear of HTML!

m4a4 m4a4 said:

The problem is that BB Inc released the wrong model first. The entire BB loving world has been eagerly awaiting a new, modern QWERTYphone..and instead the geniuses at Waterloo decided to pursue the iPhone and Android users first. Might have been a decent plan if the Z10 had a single compelling feature to lure customers to BB. The usability is mixed at best - the gestures aren't well implemented or intuitive. The UI is too Android-like, I.e. busy and overwrought. They needed a home button at the very least but instead we get magical morphing touchscreen insanity. The graphics are typically downbeat and reserved like everything BB Inc produces so it scores no points on eye candy. All told, not only is the Z10 worthless to those who need a real k/b and highly functional smartphone, its not one bit attractive to veterans of other platforms either. Could BB still pull out of this nosedive? Sure..by adding a virtual trackpad to the Q10 when it finally arrives. They should also design a mid-level BBOS 10 device with a keyboard *and* at least one hardware button on the front (preferably a trackpad/clicker.) A new "Curve" would sell like mad in developing nations and do pretty darn well in other markets, too.

I disagree with most of what you said. And you jump all over the Q10 prematurely.

Most of what you said doesn't make sense or could be said about most other phones out there. And the Z10 doesn't need a button for home because the upwards bezel swipe does it quite well (you can practically hold your phone upside-down and it would matter little in the end).

The only thing I agree with is that the Q10 should have been the flagship. But in the end, they are still doing well...

Give it 1/2 - 1 year, and then we'll see how this strategy worked out for them.

m4a4 m4a4 said:

Meant to say, "by adding a virtual trackpad to the Z10 and the Q10". Maybe someday TechSpot will become a real site with comments you can edit. Perhaps they'll even outgrow their suddenly acquired fear of HTML!

Go into forum mode. You can edit comments there.

Quickest way to get there is to click "topic" on the "Watch this topic?" thing below the comment box.

jester376 said:

Well, to be honest. I was seriously hoping these guys would go out of business by now. They entered the Q10 into the phone market way too late to catch up with the newer iOS and Android operating systems. At best, they might last 1 more year in my opinion.

Guest said:

I hope that RIM escapes financial death :)

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