Failing smartphone maker BlackBerry has just reported its second quarter finances, and they include a single damning number that will hit headlines around the world: A loss from continuing operations of $965 million.
BlackBerry says the figure includes a “non-cash, pre-tax charge against inventory” of $934 million for “Z10 inventory.” Which basically means it’s having to write down a massive pile of cash for its Z10 phone, which isn’t selling as BlackBerry had hoped (and for which it has presumably paid its suppliers and shippers). This means even without the Z10 charge, BlackBerry was going to report an operating loss of some $31 million… an unmistakable sign the company is flopping badly. BlackBerry’s manufacturing partner Jabil Circuit said yesterday it was trying to distance itself from the former smartphone giant in planning for its future.
Another interesting figure in the data is the cash and investments balance of $2.6 billion. Considering the firm has just agreed to a roughly $4.7 billion buyout by Fairfax Financial, and its patent portfolio must easily be worth a few billion dollars, the company looks like it’s heading to be wound up–because Fairfax is buying it for its assets, not its value as an ongoing concern.KE