[jrb363]

How long until the $1 Billion runs out? I know Blackberry has been struggling for the past few years and with the necessary investments in R&D, marketing, distribution, manufacturing costs, back-end support, etc I have concerns about how long that money will last if they can't turn things around.

Especially considering that they recently admitted to giving up the consumer market. I just don't see the core business market returning to them as iOS and Android continue to improve. (Plus Microsoft continually pouring money into their system.) I want Blackberry to succeed, if only for the sake of competition. I'm just not sure how long they can last.

Also: Does anybody know if they must repay the $1 Billion at some point or is it a free cash-infusion to keep the company going?

[travaz]

The answer to the question about what happens when the money runs out is easy. They close up shop and kiss it goodbye.

[Pilchard]

You don't think the savvy investors putting the $1Bn in have considered very carefully whether or not they might be smoking their money and decided it was a risk worth taking, do you?

[kb5zht]

Mistakes in the decision making process happen with investing and business just like anything else.

You don't think the savvy investors putting the $1Bn in have considered very carefully whether or not they might be smoking their money and decided it was a risk worth taking, do you?

[Bluenoser63]

How long until the $1 Billion runs out? I know Blackberry has been struggling for the past few years and with the necessary investments in R&D, marketing, distribution, manufacturing costs, back-end support, etc I have concerns about how long that money will last if they can't turn things around.

Especially considering that they recently admitted to giving up the consumer market. I just don't see the core business market returning to them as iOS and Android continue to improve. (Plus Microsoft continually pouring money into their system.) I want Blackberry to succeed, if only for the sake of competition. I'm just not sure how long they can last.

Also: Does anybody know if they must repay the $1 Billion at some point or is it a free cash-infusion to keep the company going?

It's not just 1 billion, it's the cash they currently have and the 1 billion in tax refund they are going to get too. So about 4 billion. If they can shed 40 percent of the workforce, reduce build levels to appropriate levels, then they can stop losing money. Then see what happens. Let's see what happens after six quarters.

[RH1Pearl]

Mistakes in the decision making process happen with investing and business just like anything else.

Creditors are usually paid first in bankruptcies

[RH1Pearl]

It's not just 1 billion, it's the cash they currently have and the 1 billion in tax refund they are going to get too. So about 4 billion. If they can shed 40 percent of the workforce, reduce build levels to appropriate levels, then they can stop losing money. Then see what happens. Let's see what happens after six quarters.

With no new BB10 phones in the pipeline, the current line will be tougher to sell in IQ 2014 as that is when the new Flagship phones come out from HTC, Samsung, Sony. The current BB10 line is already Spec challenged and the longer they stay on the shelves with minimal promotion, the higher the chance of more writedowns. The new Android phones in 2014 will be packed to the gills in features and specs which will make the current BB10 phones look more outdated.

[skibnik]

How long until the $1 Billion runs out? I know Blackberry has been struggling for the past few years and with the necessary investments in R&D, marketing, distribution, manufacturing costs, back-end support, etc I have concerns about how long that money will last if they can't turn things around.

Especially considering that they recently admitted to giving up the consumer market. I just don't see the core business market returning to them as iOS and Android continue to improve. (Plus Microsoft continually pouring money into their system.) I want Blackberry to succeed, if only for the sake of competition. I'm just not sure how long they can last.

Also: Does anybody know if they must repay the $1 Billion at some point or is it a free cash-infusion to keep the company going?

Fairfax loaned blackberry the money and are charging 6% interest

Posted via CB10

[sandman10]

If the money runs out, they will print some more. Keep moving BlackBerry!

[Pilchard]

Mistakes in the decision making process happen with investing and business just like anything else.

Fundamental to investing is the risk to reward ratio. If you want a risk free return buy Government bonds...oh wait, the US keeps threatening to default for political gain.....

Back to the point, the OP assumes the money will run out inevitably. I observed that the people putting the billion in think it won't and are betting a billion on that scenario.

[Meaty123]

Well, the Canadian Government can bail them out much like they did with the auto industry and they managed to turn things around. Maybe that's what needs to happen.

Posted via CB10

[Roo Zilla]

Fundamental to investing is the risk to reward ratio. If you want a risk free return buy Government bonds...oh wait, the US keeps threatening to default for political gain.....

Back to the point, the OP assumes the money will run out inevitably. I observed that the people putting the billion in think it won't and are betting a billion on that scenario.

The people who loaded BlackBerry the $1B are in a pretty much risk free situation, with potential upside if the stock ever trades over $10. They're first in line in the event of any bankruptcy, which means that as long as BBRY is worth more than $1B, they're not going to lose anything. That's not really betting on the company. Betting on the company would be if they bought additional treasury shares.

[Roo Zilla]

As to what happens when the money runs out..... They'll have one of two options. Sell off assets or take on additional debt. Taking on additional debt might not be easy, since they already have a billion in debentures out. Obviously, BlackBerry hopes they don't ever run out of money and things turn around for them in the next few quarters.

[kb5zht]

Wow how times have changed. Remember when Balsillie Lazardis' claim to fame was "but we bave 15 billion in cash!" ?

I warned that company was in high gear down a dead end street years ago and the fanbois in here called me stupid. They are mysteriously silent and absent now.