BlackBerry meltdown: Blames $1bn loss in Q2 on Z10 failure

It is no secret that BlackBerry is in trouble, and today's second quarter financial results show just how bad things are in Waterloo, Ontario.

The company's latest earnings report shows that it lost almost $1 billion in just 90 days: $965 million (£600 million). Revenues of just $1.6 billion (£994 million) have failed to offset inventory provision for the BlackBerry Z10. The phone has dramatically underperformed in sales terms.

The revenue breakdown for the quarter was approximately 49 per cent for hardware, 46 per cent for service and 5 per cent for software and other revenue.

During Q2, the company sold approximately 3.7 million BlackBerry smartphones, but most of those were BlackBerry 7 devices. BlackBerry does explain though that many BlackBerry 10 devices shipped in the quarter will not be recognised until those devices are sold through to end customers.

Including handsets shipped in Q1, approximately 5.9 million BlackBerry smartphones were sold through to end customers in Q2.

"We are very disappointed with our operational and financial results this quarter and have announced a series of major changes to address the competitive hardware environment and our cost structure," said Thorsten Heins, the company's president and CEO.

"While our company goes through the necessary changes to create the best business model for our hardware business, we continue to see confidence from our customers through the increasing penetration of BES 10, where we now have more than 25,000 commercial and test servers installed to date, up from 19,000 in July 2013. We understand how some of the activities we are going through create uncertainty, but we remain a financially strong company with $2.6 billion in cash and no debt. We are focused on our targeted markets, and are committed to completing our transition quickly in order to establish a more focused and efficient company."

BlackBerry previously announced that it will be cutting around 40 per cent of its staff, losing 4,500 jobs globally. It is also thought to be up for sale.

This is despite the launch of a new BlackBerry 10 handset this month in the UK, theBlackBerry Z30.