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Blackberry fires its VP of U.S. sales

With BlackBerry10 sales disappointing, more layoffs expected to come

Financial trends and news by Steven Loeb
July 10, 2013 | Comments
Short URL: http://vator.tv/n/3091

One-time smartphone giant BlackBerry has done everything it can to revitalize itself, including changing the name of the company! There was even a giant rollout of its brand new phone, the BlackBerry Z10, with Alicia Keys.

But nothing it has done has seemed to help. Sales have been slow, and the company is still losing money. And we all know what happens now: layoffs.

Richard Piasentin, the company's vice president for sales in the U.S., was fired last month, according to a report from the Wall Street Journal on Wednesday. And apparently that is just the beginning, as sources said that more jobs will be cut "across middle management in the sales and support divisions."

These layoffs will ne on top of the 5,000 jobs that BlackBerry was forced to cut last year.

Interestingly, Piasentin's LinkedIn profile has not been updated to reflect the change in his employment status. VatorNews has reached out to BlackBerry to confirm the report, and we will update if we hear more.

BlackBerry 10 disappointment

Piasentin's firing really could not have been much of a shock, as BlackBerry was counting on its Z10 smartphone to keep the company afloat.

First the company renamed its app store as BlackBerry World in January, and added new types on content, including music and videos. Just a week after that the company changed its name from Research In Motion to BlackBerry, and rolled out the Blackberry 10, with an event that included an appearance by singer Alicia Keys, who also became the company's new creative director.

Reports of problems with sales were already coming out by April, though, when a report from financial-services firm Detwiler Fenton said that returns of the BlackBerry10 had begun to exceed sales. 

And then, last month, BlackBerry released its quarterly earnings report, showing revenue of $3.1 billion, coming in below the expectations of of $3.36 billion. BlackBerry also reported a net loss of $84 million for the quarter, or -$0.13 a share, a terrible showing considering that analysts had expected BlackBerry to report a net profit of $0.07 a share.

Worse than that, though, was the revelation on an earnings calls that the company had shipping only 2.7 million BlackBerry 10 phones in the quarter. That is not 2.7 sold, just shipped to stores.

As a result, BlackBerry's stock dropped 25% in a day.

BlackBerry has fallen rapidly behind as Google and Apple have taken over the market. By November of 2012, Google and Apple alone accounted for nearly 89% of the smartphone market, while RIM accounted for 7%. The company’s market cap has fallen over 89% since 2008.

If BlackBerry can't get people to buy the Z10, then that really may be the end of the one-time king of the smartphone world.

(Image source: http://name-list.net)


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