Inventory glut proves costly for BlackBerry Ltd (NASDAQ:BBRY)

Posted by admin September 23, 2013 0 Comment 919 views

The one time smartphone market leader, BlackBerry Ltd (NASDAQ:BBRY) reported sales drop of more than 40% and said that it will be axing at least 4500 jobs. A few months ago, there has been news about the company fielding some prospective buyers but nothing concrete came out of that and now there seems like it has no prospective buyer at all.

Palm Inc was one company that spiraled downwards in this same manner. It had tried to launch a new OS that could not gather momentum. Finally, in 2010, HP acquired palm, but its product line was discontinued.

Inventory glut

BlackBerry Ltd (NASDAQ:BBRY)’s inventory pile-up is mountain high at and for the fiscal Q2, the company is saying that it will write-off almost $1B in inventory its latest touchscreen phones. That acquisition did not work too well for HP then and the way

BlackBerry Ltd (NASDAQ:BBRY) is heading, it seems like no one will want to touch it with a barge pole.

It was just last month that BlackBerry Ltd (NASDAQ:BBRY) said it was setting-up a special committee to scan its strategic options. This included a potential sell-out of the company, though they have not had much success on that front either. And nobody wants to be on board a sinking ship. Its large investors like Red Sky are all set to offload their stake in the company.

Blackberry 10 OS flops

Thorsten Heins, the company Chief Executive Officer had been hoping that the January-launched Blackberry 10 phones would reverse the company’s fortunes but most of the devices that were sold in the last quarter were products from the legacy range and the new models are still gathering dust.

The situation is so bad that BlackBerry Ltd (NASDAQ:BBRY) will not be marketing its devices to consumers though it has launched 4 new handsets this year. Instead, it is just straggling along with spotlighting on its professional and corporate customers. Historically, these two segments have been its primary subscriber- base.

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