BlackBerry posts huge loss; shares rise on handset deal

December 21, 2013 00:41

BlackBerry Ltd, after giving up on a plan to sell itself last month, reported a massive $4.4 billion quarterly loss on Friday as sales of its smartphones shriveled and it booked a huge inventory writedown.

Even so, its shares surged 16 percent to $7.26 in morning trading as investors welcomed a move by the Canadian company that could ease the risk of more writedowns for unsold phones.

BlackBerry said it has entered a five-year partnership with Foxconn Technology Co Ltd to develop and manufacture handsets, starting with a low-end device built for Indonesia and other emerging markets. The deal means that BlackBerry will no longer pay upfront for components for devices produced by Foxconn on its behalf.

Investors viewed the arrangement as an exit from handsets in all but name for BlackBerry, helping push its stock up despite the dismal operating numbers.

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