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CEO Chen denies BlackBerry is planning to dump handsets

Published Apr 10th, 2014 9:41AM EDT
Future BlackBerry Phones 2014

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BlackBerry CEO John Chen didn’t get his reputation as a turnaround specialist by losing money for his companies. That’s why, in an interview with Reuters, Chen said that BlackBerry will not continue to make handsets if it can’t make money from them.

“If I cannot make money on handsets, I will not be in the handset business,” explained Chen, who added that the window for deciding whether BlackBerry handsets could be profitable was small.

That said, this shouldn’t send the BlackBerry diehards into too much of a panic because Chen thinks that BlackBerry can make money selling phones as long as it ships at least 10 million per year. While this doesn’t sound like much, remember that the company only sold 3.4 million smartphones to end customers over the past quarter and most of those sales were of phones running the legacy BlackBerry 7 software. What’s more, BlackBerry only recognized revenue from 1.3 million handsets in Q4 2014 so the company can’t afford to see its smartphone sales go much lower if it hopes to eke out a profit on them.

In a followup to the Reuters story posted on BlackBerry’s website, Chen also said his remarks were “taken out of context” and that he has “no intention of selling off or abandoning this business any time soon.” Instead, Chen said the company is simply focussing on how to make this business profitable and that his goal is to keep making BlackBerry handsets.

Chen also told Reuters that while he does have a long-term strategy in place, he can’t be completely wedded to it because the situation he inherited at BlackBerry is so dire.

You have to live short term,” he said. “Maybe the prior management had the luxury to bet the world would come to it. I don’t have the luxury at all. I’m losing money and burning cash.”

Brad Reed
Brad Reed Staff Writer

Brad Reed has written about technology for over eight years at BGR.com and Network World. Prior to that, he wrote freelance stories for political publications such as AlterNet and the American Prospect. He has a Master's Degree in Business and Economics Journalism from Boston University.