It is the end of an era for BlackBerry. The company, famous for making mobile phones with physical keyboards that were once so popular people they nicknamed Crackberries, has decided to stop making their own devices.
BlackBerry said Wednesday that it depends on the partners to make the phones, which will continue to have the look and feel of BlackBerry.
The company announced a joint venture with an Indonesian telecommunications company that is going to produce it. BlackBerry plans to focus on software, a step that he has made gradually in recent years because the sales of his phones have shrunk.
The shares of BlackBerry ((BBRY, Tech30) Tech30) increased by 4% in the first operations after the announcement. But the price of the shares has been far below the maximum for some years now.
BlackBerry was once the favorite phone for Wall Street vendors, politicians and celebrities, thanks to the well-considered security system. President Obama was seen with a BlackBerry. That was also Kim Kardashian West.
But the company was already too late for the touchscreen game and customers went in search of the Apple iPhone (AAPL, Tech30), Samsung’s Galaxy (SSNLF) and other devices running on the Android system. google.
Even Microsoft (MSFT, Tech30) got BlackBerry first with their Windows phones.
CEO John Chen has tried to change the company since joining in 2013. But even when he pushed BlackBerry to mobile and security software, applications and the plethora of connected devices known as the Internet of Things, the BlackBerry has failed, published revenue declines and customers are losing.
Chen has even done what was previously unthinkable, making the BlackBerry opened for other operating systems. The company now sells phones that run on Android. He also killed his line of BlackBerry Classic phones this summer.
So Chen deserves credit for stabilizing BlackBerry and redefining areas with higher growth.
The company also does not run the risk of sinking, a legitimate concern that investors had before they took the lead. BlackBerry now has about $ 2.5 billion in cash and investments in its balance: money for a proverbial rainy day.
BlackBerry needs all the money it can get. The company also reported on Wednesday that the latest quarterly sales fell by around 30% compared to the previous year.
And BlackBerry said that even this fiscal year is expected to break at its best. That is even better than the loss analysts had predicted.
But if Chen does not let the company’s sales grow back and return profitability, more pressure can be put on him to sell BlackBerry.
That is exactly what Chen has done in the past. He sold the sybase software company in trouble with SAP (SAP, Tech30) for a hefty premium, while he was CEO of Sybase.
There has been a sale of BlackBerry for years.
However, the rumor mill can start to run again. BlackBerry also announced on Wednesday that CFO James Yersh resigned and was replaced by Steven Capelli, who worked with Chen on Sybase.
Chen and Capelli also worked together in the mid-twentieth century at Pyramid Technology, a company that was sold to Siemens under their supervision.
So Blackberry investors could expect the bars to fall three times and that Chen and Capelli could make a new sale.