BlackBerry to lay off 4,500 staff, or 40% of global workforce

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Thorsten Heins, president and CEO at BlackBerry, speaks at a conference in Orlando. (AP) Thorsten Heins, president and CEO at BlackBerry, speaks at a conference in Orlando. (AP)
SummaryBlackBerry expects to post a staggering loss of $950 million to $995 million for the quarter.

company said it plans to shave its operating costs by some 50 percent over the next nine months, as it aims to focus its attention on the enterprise market and become a more niche player. But some analysts are skeptical that the company can cut its way back to prosperity.

"We believe the most likely outcome is a break-up or sale in total or in parts," said UBS analyst Amitabh Passi.

A source at a potential suitor said the warning on Friday may speed up the sale process, but it also adds more risks.

"I think most will view it as pretty scary. It's a melting ice cube," said the source.

The Wall Street Journal, citing unnamed sources, on Friday said the company's former head Mike Lazaridis has been talking with private-equity firms about possibly mounting a joint bid for the struggling smartphone maker.

Lazaridis, who owns a 5.7 percent stake in the company, has reached out to private equity firms that include the Blackstone Group and Carlyle Group, said the report.

Lazaridis was not immediately reachable for comment and BlackBerry declined to comment. BLACKBERRY Z10 SALES WEAK

Waterloo, Ontario-based BlackBerry, once Canada's premier technology company, said it expects to book a $930 million to $960 million writedown in its fiscal second quarter owing to a ballooning stockpile of unsold BlackBerry Z10 devices.

The company had bet much of its future on the popularity of the Z10 touchscreen device - the first of the smartphones to be powered by its new BlackBerry 10 operating system. While the device drew favorable reviews, it has failed to gain traction among consumers since its introduction earlier this year. For the second quarter, the company expects to have sold about 3.7 million BlackBerry smartphones to end users. BlackBerry said it is changing the way it accounts for device sales, now booking revenue only after a device is sold to the end customer, and not to carriers.

Worryingly, most of the unit sales being recognized in the quarter are older-generation BlackBerry 7 devices. The company said it could not recognize BlackBerry 10 devices shipped in the quarter until those devices are sold through to end customers. That suggests carriers have been having difficulty moving the new line of devices.

MAJOR JOB CUTS

BlackBerry said it expects its adjusted net loss, before giving effect to the inventory

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