In correlation with recent events, BlackBerry is currently being sued by thousands of shareholders because of misleading information in relation to the company’s future. After, the company took a quick turn downhill its shareholders claim that they were not given sufficient warning in regards to the company’s financial state. My analysis shows that BlackBerry’s alleged fraudulent financial accounting was most likely due to pressure from the competitive smartphone market. iPhones and Android smartphones are becoming increasingly popular while the necessity for a exclusive business phone is decreasing. This is proven by the recent activity in the stock price and business practices of Blackberry.
The company’s stock price closed today at 7.69 which is 4.23% lower than it was 5 days ago and 25% lower than it was less than a month ago. Blackberry also laid off 40% of its employees and claimed a billion dollars in loses from the launch of its new Z10 smartphone. This seems to be a good indicator that the company is doing everything in its power from going bankrupt. This begs the question if the company was intentionally producing false indicators of its financial state to desperately stay competitive in the smartphone industry.
Orginal Article:
“BlackBerry hit by shareholder lawsuit claiming company misled investors.” The Guardian05 Oct. 2013. Guardian News and Media Limited. 07 Oct. 2013 <http://www.theguardian.com/technology/2013/oct/05/blackberry-shareholder-lawsuit-investors>.
Additional Resources:
LUBBEN, STEPHEN J. “The Bankruptcy Question for BlackBerry.” The New York Times – DealBook 24 Sept. 2013. The New York Times. 07 Oct. 2013 <http://dealbook.nytimes.com/2013/09/24/the-bankruptcy-question-for-blackberry/?_r=0>.
Tsukayama, Hayley. “BlackBerry nixes earnings call in light of sale; T-Mobile stops selling the handsets in stores.” Washington Post 26 Sept. 2013. The Washington Post. 07 Oct. 2013 <http://articles.washingtonpost.com/2013-09-26/business/42409224_1_blackberry-z10-blackberry-platform-t-mobile>.