BlackBerry may consider exiting handsets, eyes investments
(Reuters) - BlackBerry Ltd would consider exiting its handset business if it remains unprofitable, its chief executive officer said on Wednesday, as the technology company looks to expand its corporate reach with investments, acquisitions and partnerships.
Context & Ripple Effects
Two years after Reuters reported that BlackBerry's parent had hired a restructuring law firm behind closed doors, the conversation has moved from quiet preparation to open conditionality: the chief executive now says publicly that the handset business stays only while it is profitable, alongside a confirmed plan to grow corporate reach through investments, acquisitions and partnerships.
The backdrop explains the candor. comScore data for January 2014 put BlackBerry's US smartphone share below Windows Phone's, and by late March the company had recast itself as a cross-platform enterprise manager riding the bring-your-own-device wave, with BBM at 85 million monthly active users as its bridge to other ecosystems. Yet the same week's coverage had the CEO promising new high-end keyboard devices within 18 months and winning a preliminary injunction against Ryan Seacrest's Typo iPhone keyboard case — so the exit talk sits in tension with a still-active device roadmap, which is why the handset-exit point is best read as a stated option rather than a settled decision.
First-order effects
- Device buyers and carrier partners face explicit timeline risk: the CEO has said outright that handsets survive only while profitable, even as he separately committed to new keyboard-led flagship models within 18 months.
- Capital allocation shifts — the confirmed investments-acquisitions-partnerships program points money toward expanding corporate reach instead of defending device market share.
Second-order effects
- Suppliers and carriers exposed to BlackBerry volumes must price for a device line whose owner has publicly attached a profitability condition to keeping it.
- Any potential buyer of BlackBerry's handset assets gains negotiating leverage from the fact that exit is officially on the table, while BBM's 85 million monthly active users become the cross-platform asset a partnership strategy would monetize instead of the phone itself.
Third-order effects
- If the pattern holds, BlackBerry becomes the test case for whether a smartphone pioneer can persist as a software, security and messaging licensor after shedding in-house hardware.
- The episode fits a broader playbook in which hardware incumbents publicly measure their device lines asset-by-asset against profitability thresholds before formally exiting, turning what used to be boardroom secrecy into shareholder communication.
The trend: Smartphone incumbents losing share are reframing their handset businesses from core identity to conditional asset, with executives openly tying hardware survival to profitability.