Blackberry Foresees Massive Second Quarter Loss

Blackberry (BBRY on the Nasdaq) gave its shareholders a Friday afternoon "treat" in the form of even more bad news, as the company is forecasting an even larger than expected Q2 loss.

According to one analyst, the company is "clearly sailing off a cliff" right now.

Shareholders of Blackberry experienced a mix of hope and dread when shares of the company were halted roughly 45 minutes before the market closed on Friday. Halting a company during the middle of a trading day? Surely this was going to be big news. The question was - good news (in the form of a buyout) or more bad news?

Shareholders of Blackberry, who have been taken on an absolute roller coaster of emotions over the past couple of years, weren't really surprised when the company reported more bad news in the form of a massive second quarter miss.

Just how bad was the miss?

Prior to today, analysts had been expecting the company to report a Q2 loss of 15 cents per share on $3.06 billion in revenue.

Blackberry announced that they will be posting a loss, excluding items, of 47-51 cents per share on revenues of $1.6 billion in the second quarter. In total, the company is expecting to post a quarterly loss of nearly $1 billion in the second quarter after including restructuring costs and a write-off of unsold Blackberry phones.

In addition, the company announced that they will be slashing 4,500 of their workforce in a restructuring move.

The restructuring move certainly wasn't a surprise, but the size of the Q2 miss certainly was. The company went all-in with their new Blackberry 10 phones, but they clearly didn't sell as well as Blackberry had hoped. The fact is that Blackberry is being crushed by their competition, mainly in the form of Android and iOS phones.

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Shares of Blackberry closed the regular session at $8.70, down about 17.32% on the day.

The company is in a strange position right now - they are currently looking for a buyer, and are hoping to consummate a deal by the end of the year. However, it is pretty tough to sign up new customers when the company is in tatters and looking for a buyer.

The Blackberry saga continues.

Filed under: General Market News