Embattled BlackBerry maker Research In Motion is planning to slash thousands of jobs worldwide as it seeks to restructure in the wake of losses and shrinking market share, several news sources report.
That’s on top of a round of layoffs last summer that saw 2,000 people lose their jobs, and it doesn’t take into account “stealth” layoffs that have reportedly been taking place at the company for some time. Junior staff have been receiving layoff notices in what has become known internally as “Goodbye Thursdays,” because the layoffs typically take place on that day, Reuters reports.
If the worst-case number is correct, RIM’s staff could be reduced to around 10,000 worldwide, down from around 18,500 as recently as last year.
The layoffs are likely to hit southwestern Ontario the hardest, as RIM’s employment is most intensely concentrated near its headquarters in Waterloo, Ontario.
The company has seen its market share slide dramatically over the past two years, as Apple’s iPhone and smartphones running the Android operating system have come to dominate the market.
The company’s troubles, which included posting a loss of 24 cents per share in the latest quarter, prompted the departure of the company’s co-CEOS, Jim Balsillie and Mike Lazaridis. The new CEO, Thorsten Heins, said in a conference call earlier this year that he is looking to eliminate $1 billion of spending, which many took to mean more layoffs would be coming.
Although RIM remains strong in some developing countries, such as India, the company has been steadily losing market share around the world. Recent research cited by the Globe and Mail indicate the company now accounts for fewer than 7 per cent of global smartphone shipments, down from a market-leading position just a few years ago.
The company recently released details about its new BlackBerry 10, which is expected to hit the market later this year. But many analysts say it’s too late for the company to bounce back. Pipe Jaffray analyst Gene Munster told CNBC in April that RIM is going “out of business.”
Buyout rumours have swirled around the company, most recently a bizarre rumour about a $3.5-billion bid from Microsoft. Analysts, however, are increasingly saying that RIM is becoming an unattractive takeover target.
“There are not that many buyers left” for RIM, Recon Analytics analyst Roger Entner said, as quoted at the Toronto Star. “BlackBerry is running out of sugar daddies.”
Shares of RIM are hovering around $11, down from a peak of $140 in 2008.