As rumored earlier this week, BlackBerry is to lay off 4,500 employees, around 40 percent of its workforce, and retreat from the consumer market. The layoff news comes in an unexpected early earnings guidance release, in which the struggling manufacturer reveals it expects to book losses totalling almost $1 billion in the most recent quarter.
The massive loss is mainly attributable to the disastrous sales performance of the company's Z10 smartphone, its first to run its new BlackBerry 10 OS. BlackBerry says it will take a "primarily non-cash, pre-tax charge against inventory and supply commitments in the second quarter of approximately $930 million to $960 million" due mainly to the Z10. In the second quarter, the company shipped just 3.7 million smartphones, most of which were running BlackBerry 7, the company's older operating system. The company was shy in revealing exactly how many BlackBerry 10 devices it sold last quarter.
Also, its Z10 is planning on being marketed as an "entry-level" smartphone, with possible large price cuts in the future.