BlackBerry confirms layoff of 250 Waterloo-based employees
Published Thursday, July 25, 2013 10:37AM EDT
Last Updated Thursday, July 25, 2013 6:32PM EDT
BlackBerry has laid off 250 people from its Waterloo operations while also losing a top executive.
Employees were given notice Tuesday and the company confirmed the news late Wednesday.
BlackBerry says the employees worked in the new product testing facility, supporting its manufacturing, and research and development efforts.
The company says the changes will help BlackBerry "increase efficiency" and scale the company "correctly" for new opportunities.
Also departing is David Smith, the company's executive vice-president of mobile computing.
Smith had been the company's point man for the Playbook tablet, which was discontinued by BlackBerry after disappointing results.
A company spokesperson says Smith resigned for personal reasons and stay with BlackBerry during the transition.
BlackBerry is in the midst of trying to recover a stronger position in the highly competitive smartphone market with its new line of phones and operating system.
About 5,000 employees were laid off from the company last year in restructuring efforts.
At the company's annual general meeting earlier this month, CEO Thorsten Heins told shareholders that BlackBerry is in the midst of a "complex transition."
"We are still in the midst of a major, complex transition of this company, and like most of these transformations ... progress can be volatile," Heins said on July 9.
He encouraged investors at its annual meeting to remain patient while the company navigates its plan to become profitable again.
Industry analyst Kevin Restivo says 250 layoffs are a relatively small number by BlackBerry standards, meaning the decision was likely based on one opportunity for efficiency rather than a harbinger of further cuts to come.
“Maybe these people have performed a duty that could be seen as somewhat superfluous,” he tells CTV News.
More key to the company’s future, Restivo says, is ensuring that it comes out of its transition phase stronger, and gets a warm global response to the BlackBerry 10 operating system.
“It’s very early to tell how much demand there is for BlackBerry 10,” he says.
Although the layoffs may not signal anything about BlackBerry’s future, they do have Waterloo Region on guard against further cuts to its workforce.
Shashanka Das is a partner in Koh-I-Noor Restaurant, located on Phillip Street near the BlackBerry campus.
Since BlackBerry’s troubles and layoffs began earlier this decade, he says, business has slowed down to the point where they only need one server during the lunchtime rush, down from three.
“Then, when we served 40 people, we said it was slow,” he says.
“Now, if we serve (40) on a Friday, we say we are happy.”
Communitech had been planning to wind down its centre to help laid off BlackBerry employees in August, but as a result of the latest layoffs, will keep the centre open until November.
BlackBerry stock closed the day at $9.26 per share on the Toronto Stock Exchange, down four cents from Wednesday's closing price.