True north strong: BlackBerry not planning to move outside Canada
Chief executive John Chen said company staying put in Waterloo, Ont., despite real estate sell-off
WATERLOO, Ont.—BlackBerry Ltd. chief executive John Chen says the device maker has no intention of moving its main operations outside of the country, despite selling some of its real estate in Canada.
In a conversation with reporters, Chen said he intends to keep the company’s headquarters in Waterloo, Ont., and maintain its QNX division in Ottawa.
“I don’t have any plans to move out of Canada,” he said after the company reported stronger than expected financial results.
“We might be consolidating some functions in one place.”
Chen said the company needed to beef up its marketing operations in New York and Washington, two areas where BlackBerry smartphones still have a strong customer case.
In recent months, BlackBerry has reached agreements to sell a majority of its Canadian real estate holdings, as well as its United States headquarters in Irving, Texas, and lease back a portion.
The company also sold a handful of buildings to the University of Waterloo under an agreement that would also allow the company to lease back some of them.
BlackBerry, which has been restructuring and cutting costs, reported a fourth-quarter loss of US$423-million or 80 cents per share, compared with a profit of US$98-million or 19 cents per diluted share a year ago.
However, excluding several one-time items, BlackBerry says it reported an adjusted loss from continuing operations of US$42-million or eight cents per share for the quarter.
The average analyst estimate compiled by Thomson Reuters had been for a loss of 55 cents per share for the quarter.
Chen told a conference call with analysts he is now turning his attention to growth for the struggling company.
In the short term, he said that means growing its software and services business including its popular BBM service, and embedded software like QNX.
“We just need to make sure that we do it in a well-paced manner and don’t want to get too much ahead of ourselves,” Chen said.
“I’m very pleased with the fact that the company’s now back in execution mode.”
Chen, who took over late last year, said the company’s normalized use of cash from operations was now 30 per cent lower compared with last quarter.
“I think the numbers show we are about a quarter ahead of schedule at this point,” he said.
In its outlook, BlackBerry says it is targeting break even its cash flow results by the end of its 2015 financial year.
The revenue breakdown for the quarter included about 37 per cent from hardware, 56 per cent for services and seven per cent for software and other revenue.
The company said it recognized hardware revenue on approximately 1.3 million BlackBerry smartphones in the quarter.
BlackBerry had US$2.7-billion in cash, cash equivalents, short-term and long-term investments of March 1.
The company has been cutting costs and restructuring its business in a bid to stay alive, including a plan to eliminate about 40 per cent of the company’s workforce.