28th June, 2012
BlackBerry maker Research In Motion said Thursday it would cut 5,000 jobs worldwide and delay its new smartphone platform as losses for the Canadian firm deepened.
The struggling firm said its loss in the quarter ending June 2 widened to US$518 million and delayed until 2013 a new platform to help compete with Apple and other smartphone makers.
The company, which has been hammered in the rapidly changing smartphone market now dominated by makers of devices using Google’s Android software and Apple’s iPhone, said it would cut jobs to boost efficiency.
The move includes “a global workforce reduction of approximately 5,000 employees, which is expected to be completed by the end of fiscal 2013.”
To make matters worse, the company said it was delaying its new BlackBerry 10 platform which had been expected later this year, in an effort to drive sales in the key holiday season.
The new platform is widely seen as the last chance for BlackBerry to regain traction in the marketplace.
“The successful launch of the BlackBerry 10 platform and the delivery of high quality, full-featured BlackBerry 10 smartphones remain the company’s number one priority,” a statement said.
But the development “has proven to be more time consuming than anticipated” and the new system launch was put off until the first quarter of 2013, it added.
“RIM’s development teams are relentlessly focussed on ensuring the quality and reliability of the platform and I will not compromise the product by delivering it before it is ready,” said Thorsten Heins, who took over earlier this year as president and chief executive.
“I am confident that the first BlackBerry 10 smartphones will provide a ground-breaking next generation smartphone user experience.”
The company expects to incur restructuring related charges of $350 million by the end of fiscal 2013.