BlackBerry expects handset profitability next year

BlackBerry CEO: This is a key part of turnaround strategy
BlackBerry CEO: This is a key part of turnaround strategy

BlackBerry could post a profit next year, helped by the launch of its Priv model, as the company recovers after a bruising few years that saw it lose its dominant position in the smartphone market.

"The company is doing reasonably well now, from a financial standpoint, so now our focus is to grow our businesses," CEO John Chen told CNBC at the Asia-Pacific Economic Cooperation (APEC) CEO Summit in Manila.

"We still have very high fixed costs but [handset] profitability will come next year."

For the three months ended August 29, BlackBerry reported a quarterly loss of $66 million, excluding one-time items like a non-cash credit tied to the value of debentures and restructuring charges.

The Toronto-based firm's first Android-powered device, the Priv, has received mostly favorable reviews following its official launch earlier this month.

"This [the Priv] is a big deal in terms of market acceptance and receptivity, we want the market to tell us what it likes and we can adjust accordingly," Chen said.

In the past, BlackBerry phones were criticized for a lack of apps but the Priv's Android software will open up the developer application program interface (API), Chen said.

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For now, the Priv is only carried on AT&T in the U.S. but BlackBerry is hoping to count T-Mobile as an additional carrier as the latter two companies look to mend their strained relationship. The two companies severed ties last year after T-Mobile launched an e-mail campaign encouraging customers to switch their BlackBerry devices for an iPhone.

The difference of opinion with T-Mobile CEO John Legere was related to how he positioned certain products over BlackBerry's products, explained Chen.

"I fully understand from his perspective why he did what he did....But I would obviously like T-Mobile to also sell our phones. We're talking about it, it's not guaranteed yet but I'm hopeful...We obviously want every carrier to be friends of ours."

But for now, Chen's priority is firmly outside the smartphone business.

"Software is something I believe BlackBerry should really get into very seriously."

While the firm already provides a lot of software to government agencies and banks, Chen wants to expand the business to secure voice and secure texting, basically "everything to do with how a government handles emergencies," he said.