BlackBerry could exit smartphone business

BlackBerry could exit smartphone business

BlackBerry chief executive John Chen has claimed that it may stop manufacturing handsets if it cannot return to profitability.

Mr Chen told Reuters that should the firm exit the smartphone market, it will turn its attention to expanding its corporate reach with investments, acquisitions and partnerships.

He told the news provider that BlackBerry could turn a profit on as few as 10 million shipments per year.

That would compare to the company's peak in 2011, when it shipped 52.3 million devices, notching up an operating profit of $4.6 billion (£2.74 billion).

But at the end of the fiscal year in February, the firm shipped 13.7 million handsets, but still recorded a loss of almost $7 billion, which included around $3.7 billion in writedowns on unsold inventory of its latest BB10 models.

But Richard  Windsor of the Radio Free Mobile consultancy told The Guardian: "Chen thinks he can make money shipping 10 million units a year. This looks like a tall order given that Android vendors Huawei and LG Electronics are struggling to keep their heads above water shipping 50 million smartphone units last year."

He added that BlackBerry's smartphone business was likely to fail no matter what action was taken.

And Mr Chen told Reuters that if such a prediction was fulfilled, the company would leave the market, stating: "If I cannot make money on handsets, I will not be in the handset business."

However, the company's chief executive took to his blog to reassure customers that BlackBerry would not be giving up.

He said: "I want to assure [customers] that I have no intention of selling off or abandoning this business any time soon. I know you still love your BlackBerry devices… we will do everything in our power to continue to rebuild this business. Rest assured, we continue to fight."