BlackBerry: 'The worst is behind us'

Only time will tell if the former smartphone giant can regain its mojo.
By Aaron Sims | Aug 05, 2015
After three long years, BlackBerry has announced that it successfully concluded a long restructuring process and is back on a growth footing. The company that once dominated the smartphone market in its infancy saw its sales fall to both Apple and Android devices. As it has attempted to reinvent itself, BlackBerry has shrunk its workforce to 7000 employees, or roughly 60 percent, over the last three years

"We have completed the restructuring notification process, and the workforce reduction that began three years ago is now behind us," said the memo from BlackBerry's Chief Executive John Chen that was sent out on Friday. "More importantly, barring any unexpected downturns in the market, we will be adding headcount in certain areas such as product development, sales and customer service, beginning in modest numbers," said Chen, who personally thanked many who stayed with the company as the restructuring progressed.

Chen, a well-regarded turnaround artist in the tech sector, took over as CEO roughly eight months ago and has moved rapidly to stabilize ailing the company. By selling assets that were not in line with the new core strategy and partnering to make the company's manufacturing and supply chain more efficient, the company is well on its way to recovery. Additional capital has also been raised through the sale of real estate holdings in BlackBerry's hometown of Waterloo, Ontario.

For the first time in four years, a positive cash flow is likely to be achieved by the end of the year, positioning BlackBerry to make strategic acquisitions. The goal is to strengthen areas that are likely to drive future revenue growth. Chen, who is well known for having turned around enterprise software maker Sybase Inc in the late 1990s, told employees in the memo that he is confident BlackBerry now has the right organizational team in place to execute its business strategy.

Chen also stressed that there was "no margin for error to complete BlackBerry's turnaround to success". He called on all employees to maintain focus as the company introduces its new Passport and Classic devices, and an upgrade to its device management system later this fall.

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