WATERLOO — At the halfway point in his turnaround plan BlackBerry chief executive officer John Chen says the best way to keep employees motivated is to improve the smartphone maker's financial performance.
"The company needs to be financially stable. I don't know of any way to improve the morale of a company's people if the company is not doing well," Chen said Friday in conference call with analysts to discuss BlackBerry's fourth quarter financial results.
"All of the people here are professionals," he said. "If the company does not do well they know some negative thing is going to happen down the road. The No. 1 thing we want to do is stabilize the company's financials, and people understand that."
BlackBerry now employs about 2,700 people in Waterloo, down from a peak in 2011 of 11,000. Worldwide, the payroll is about 7,000. The company is hiring in small numbers and trying to recruit university co-op students.
The smartphone maker reported a net profit of $28 million US, or five cents a share for the quarter ended on Feb. 28. That compares with a loss of $148 million US, or 28 cents a share, for the same period a year earlier.
Revenue fell to $660 million US from $793 million US.
"I think as we do better financially and having a good road map, which we do and we are delivering these products, my experience is the morale will gradually turn positive," Chen said.
"Obviously, it is easier for me to say it because I see it through a different lens, but I would say the morale of the company today is a lot better than a year ago," he said. "It probably still needs to be a lot better."
Chen said the company will focus on three areas in fiscal 2016: sustainable profitability, free cash flow and stabilizing revenue.
"We are a little ahead of our turnaround milestone, so I like to remind everybody that we are only halfway through," he said. "Our focus now is to stabilize revenue, and I am mindful that transitions like this are never easy and never quite smooth."
BlackBerry put out four new phones in the past year, including the Classic and Passport models, launched the BlackBerry BES 12 enterprise software, and started the project to monetize the BBM messaging service.
"Today, the Classic and Passport are carried by over 160 carriers and over 7,000 retail stores in 86 countries, and this number will continue to up," Chen said. "This is the best carrier-retail support worldwide we have seen in a number of years."
Chen said the company hopes to make money on BMM through ads, BBM money and virtual goods. He said the company is generating revenue from more than 20 million ads requests per month.
"We have just introduced the virtual goods, and premium subscription for the vanity pins are now generating monthly-subscription fees," he said.
During 2014, the company launched two new BBM services for enterprise customers — BBM Protect and BBM Meetings
"We are starting to see pickup and strong interest there," Chen said. "In the quarter, we signed a deal with the Inland Revenue Service of the United States for BBM Protect."
Another 400 companies are trying BBM Meetings, he said.