BlackBerry has posted a second quarter net loss of $965 million, blaming the BlackBerry Z10 for its misfortune.
Despite reporting $1.6 billion (£994 million) in quarterly revenue, the company’s $965 million (£599 million) in losses complete overshadowed any success BlackBerry had this quarter.
The huge losses are attributed to what the company calls “Z10 Inventory Charge”, which means the company is being penalised for its stock of BB10 flagship handsets that it failed to sell.
Mirroring Microsoft’s surplus of Surface RT inventory that meant the company incurred $900 million charges, the BlackBerry Z10 has failed to appeal to consumers, despite a new touchscreen focus and reinvented BlackBerry 10 OS.
“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, President and CEO of BlackBerry.
It was recently announced that BlackBerry has agreed to a $4.7 billion sale to Fairfax Financial consortium, but the company has said it is still exploring other opportunities while the deal goes through.
BlackBerry has also had to cut 4,500 jobs in light of its losses, which equates to 40 per cent of its workforce.
“We understand how some of the activities we are going through create uncertainty, but we remain a financially strong company with $2.6 billion in cash and no debt. We are focused on our targeted markets, and are committed to completing our transition quickly in order to establish a more focused and efficient company.”
Despite poor Blackberry Z10 sales, the company has still recorded around 3.7 million smartphone sales this quarter, perhaps boosted by the physical QWERTY keyboard BB10 smartphones like the BlackBerry Q10 and BlackBerry Q5.