BlackBerry CEO John Chen rejected the recent takeover rumors, saying that the company is not for sale, at least for now. While talking on the company’s turnaround plans, Chen told viewers this in a recent interview on CBC’s The Exchange with Amanda Lang.
Not selling BlackBerry now
“I don’t have any intention to sell BlackBerry,” told Chen, adding, “not until the BlackBerry shareholder has good value reflecting truly what we have.”
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At its peak in 2008, when BlackBerry was known as Research in Motion, its stock traded as high as $140 per share, while today the stock is hovering at around $10. With the launch of the iPhone, BlackBerry was slow to address the changing trend, which knocked the Canadian firm off the top spot. Then entered John Chen, a 60-year old Hong Kong citizen who left his retirement to guide the company back to its past fame. If he succeeds in his attempts, selling the firm will surely be on the cards, provided there is “potential proper suitor that would take care of our customers,” Chen said.
On the turnaround process, Chen said they are now entering the second phase. Chen told viewers that BlackBerry’s “claim to fame” is in security and privacy, adding that in the last quarter, the firm won 2,600 new or renewed contracts, with some from big names, for its software servers. This is surely impressive.
Why is Chen not exiting hardware?
Presently, BlackBerry is more of a software firm than a smartphone company. But still Chen has no plans to exit the hardware business completely. He says the reason for this is both practical and emotional. Chen notes that BlackBerry handsets are the most secure, and governments all over the globe are still trusting the company’s phones. “The emotional reason is, BlackBerry is iconic to the industry. We started this industry arguably,” Chen said.
BlackBerry’s latest earnings report created a good impact by showing the potential of the company’s software business. For the quarter, the Canadian company’s software sale increased by over 150% to $137 million, making Chen’s target of $500 million in software sales appear feasible. In contrast, hardware sales were disappointing, with BlackBerry selling only 1.1 million devices compared to 2.6 million last year.
On Thursday, BlackBerry shares closed up 1.04% at $7.77, and year to date, the stock is down by almost 30%.