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BlackBerry posts $4.4bn loss and agrees Foxconn deal

BlackBerry has reported a loss of $4.4 billion [£2.7 billion] in the third quarter after it continued to suffer from diminishing sales in its consumer handset division on the same day it announced a new distribution deal with Foxconn.

The Canadian-based firm announced the widening loss in the same quarter that it failed to secure a sale and continued to slide when it came to device sales even though its enterprise business remained strong.

"While our enterprise services, messaging and QNX embedded businesses are already well-positioned ... the most immediate challenge for the company is how to transition the devices operations to a more profitable business model," said John Chen in his first results call since being appointed CEO last month.

It was also confirmed that revenue fell by 56 per cent from $2.73 billion [£1.67 billion] to $1.19 billion [£730 million] with the amount of mobile phones sold dropping to 1.9 million from 3.7 million in the previous quarter.

The firm’s cash reserves grew to $3.2 billion [£1.96 billion] from $2.6 billion [£1.59 billion] in the previous quarter, however, much of this was due to the $1 billion [£610 million] convertible bond issue that followed the failed sale process that concluded last month.

Brian Colello, analyst at Morningstar, thinks the overall turnaround strategy is more important than the results with “a lot of different assets that could point the company in different directions.”

Better news came in the shape of a five-year deal signed with Foxconn that will see the Taiwanese firm work on a new smartphone with BlackBerry to allow the latter to attempt to garner some success in the Far East.

"Partnering with Foxconn allows BlackBerry to focus on what we do best - iconic design, world-class security, software development and enterprise mobility management - while simultaneously addressing fast-growing markets leveraging Foxconn's scale and efficiency that will allow us to compete more effectively,” stated Chen, according to the BBC.