Canadian mobile technology company BlackBerry cut 250 jobs at its Waterloo facility yesterday. The company is cutting the positions from its new product testing department that supports its research and development efforts.
The layoffs did not come as a complete surprise, as BlackBerry announced its plans last year to eliminate 5,000 jobs in order to become more efficient. Spokesperson Lisette Kwong wrote in a press release, “This is part of the next stage of our turnaround plan to increase efficiencies and scale our company correctly for new opportunities in mobile computing.”
BlackBerry has not fared well in the highly competitive smartphone market, losing market share to Apple, Samsung and other manufacturers. The company has attempted to regain its former dominance by releasing a new line of phones with an updated operating system. However, sales have been sluggish. As a result, BlackBerry’s stock price dropped below $10 this month for the first time since 2012.
Because the layoffs affected the hardware division rather than BlackBerry’s software development department, analysts speculate that the company is finally readying to spin off its smartphone manufacturing activities to focus on creating software for other device makers.
Some analysts are not willing to write BlackBerry’s obituary quite yet, though. The company’s recent quarterly earnings rose 15% from the previous quarter, and its smartphones make up a significant portion of its revenue.
BlackBerry CEO Thorsten Heins has dropped hints that new products from his company could hit store shelves before the end of the year, although the company has not made any official announcements. Analysts predict that BlackBerry will release a smaller tablet to replace its PlayBook, which it decided to discontinue.