BlackBerry to Slash Its Workforce by Up to 40% - Wall Street Journal

TORONTO—BlackBerry Ltd. is preparing to make deep staff cuts by the end of the year via layoffs that could cost up to 40% of its employees their jobs, people familiar with the matter said. The layoffs will cut across all departments and will occur in waves, likely affecting several thousand employees, the people said. They come as the once dominant smartphone maker looks for ways to get a handle on costs and shrink its operations to better fit a world in which competitors like Apple Inc. and Samsung Electronics Co. have eaten deeply into its market share. "Organizational moves will continue to occur to ensure we have the right people in the right roles to drive new opportunities in mobile computing," a BlackBerry spokesman said. The spokesman declined to comment on the 40% figure. BlackBerry had 12,700 employees as of this March, the last time it disclosed a total number. The scale of the planned layoffs paints a stark picture of just how far the Waterloo, Ontario-based company has fallen. Just two years ago, BlackBerry had more than 17,000 employees and 14% of the U.S. smartphone market, according to IDC. Now, it has less than 3% of the U.S. market. BlackBerry swung to a $646 million loss last year as its revenue plunged 40%, to $11 billion. This year hasn't started out much better. The company shed 4 million subscribers and posted a loss of $84 million in the quarter that ended June 1, and said it expects to show another operating loss when it reports earnings next week. For the first time, the company won't disclose its subscriber numbers next week. Smaller rounds of layoffs began earlier this summer, mostly from the sales and research and development divisions, and follow the loss of 5,000 jobs last year. Some employees have been told by managers which of the new waves of cuts will affect them, one of the people said. The cuts come a month after BlackBerry announced that it had formed a special board committee to review strategic alternatives that could include a sale of the company. The board is looking to conduct a speedy sale process that could be wrapped up as early as November, according to people familiar with the matter. The company's two flagship new phones, unveiled in January after more than a year of delays, have failed to catch on in North America, carrier executives and retailers have said. On Wednesday, the company launched a new, bigger phone called the Z30 at a small event in Malaysia. Last year, Chief Executive Thorsten Heins embarked on a broad cost-cutting initiative meant shave $1 billion off the company's books, laying off several thousand employees and shuttering several manufacturing sites. The formation of a board committee to explore a sale of the company was largely seen analysts and investors as a concession that the cuts and the company's new line of phones had failed to level BlackBerry with its competitors. Write to Will Connors at william.connors@wsj.com via Technology - Google News http://news.google.com/news/url?sa=t&fd=R&usg=AFQjCNF27HYsjkrnYva4aorumiO5cT3deQ&url=http://stream.wsj.com/story/latest-headlines/SS-2-63399/SS-2-330943/

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