BlackBerry posts surprise Q4 profit; co-founder steps down

Net income in the quarter was $98 million, compared with a year-earlier loss of $125 million

Helped by “1-million sales” of its latest offering — the Z10 smartphone, BlackBerry made a surprise turnaround in the last quarter of the financial year ended March 2, 2013, posting a profit of $98 million and said its co-founder Mike Lazaridis has decided to step down.

The struggling smartphone maker in a release said it shipped “6 million smartphones, including approximately 1 million BlackBerry 10 units” during the fourth quarter.

The Nasdaq-listed company had posted losses in the previous three quarters of the 2013 financial year while for the same period last year, it had reported a loss of $125 million.      

BlackBerry also announced that Lazaridis has decided to retire as vice-chairman and director of the company.

“Lazaridis co-founded BlackBerry nearly 30 years ago and served as a co-CEO of the company until last year when he was elected vice-chair of the Board. Lazaridis will step down from the BlackBerry Board effective May 1, 2013,” it said. In the same month last year, BlackBerry's another co-founder Jim Balsillie had resigned as Director from its board.      

BlackBerry said it shipped about 370,000 PlayBook tablets during the fourth quarter. “Revenue for the fourth quarter of financial year 2013 was approximately $2.7 billion, down 36 per cent from $4.2 billion in the same quarter of financial year 2012,” it said.

To revamp its flagging sales and take on rivals Apple and Samsung, the Waterloo, Ontario, based company in January this year launched its latest software, BB10, offering more applications for users. It also re-christened itself as 'BlackBerry' from Research in Motion (RIM) in January.      

BlackBerry has a subscriber base of around 76 million by the end of fourth quarter, the company said. For the 2013 financial yera, BlackBerry's revenues stood at $11.1 billion, down 40 per cent from $18.4 billion in financial year 2012.

The company, however, reported a net loss of $646 million for 2013 financial year, against a net profit of $1.2 billion in the previous financial year.

On the outlook, it said “The company will be increasing its marketing investment in the first quarter of financial year 2014 in support of the global launch of BlackBerry 10.”  This also includes the anticipated 50 per cent sequential increase in marketing spending, it added.

“... The company believes it will approach break even financial results in the first quarter based on its lower cost base, more efficient supply chain, and improved hardware margins,” it said.

BlackBerry was founded in 1984 by Mike Lazaridis, Douglas Fregin and Jim Balsillie.

Earlier this month, Lazaridis and Fregin announced that they have come together again to establish Quantum Valley Investments, a $100 million private fund, to support breakthroughs in quantum information science.