NEW YORK (TheStreet) -- How can a company report its worst quarter with losses of about $4.4 billion and still see its shares rocket 15% higher? John Chen, that's how.
The ink on BlackBerry's (BBRY - Get Report) interim CEO John Chen's updated business card may not have dried but that hasn't prevented the newest chief from asserting control. More than one c-suite office displays a new name on the desk, and even a board member has left the building.
Over half the revenue since the previous year's same quarter is also gone. Total revenue for the third quarter dropped 56% to $1.20 billion. Subscribers are churning at a rate of 12% to 13% a quarter and the company lost $8.37 a share.
Chen decided BlackBerry is no longer a handset hardware maker and will focus on services. Actually, Chen didn't decide, the above losses indicate consumers did. Chen receives credit as the first BlackBerry CEO smart enough to recognize the obvious.
Another distinction between Chen and former CEO Thorsten Heins is Chen appears ready to take the pieces and rebuild the Ontario Tech company into a leader again.
Attempting to find a buyer for BlackBerry was probably the right choice for the company at the time. Heins was likely the best person to liquidate the company, and his pay package certainly suggested he was a hired gun to make the sale. But it was the final example of BlackBerry taking too long to execute.
OEM supplier Foxconn will replace BlackBerry's in-house production of hardware. If you don't know Foxconn, the company also manufactures parts and/or products for Apple (AAPL), Amazon (AMZN), Nokia (NOK), Microsoft (MSFT) and other well-known names.
Friday's revelations and market reaction supports and vindicates why I think and wrote that BlackBerry is a buy. Eric Jackson wrote an outstanding piece in Real Money. (If you don't have a subscription, sign up for a free trial. Not only do I use the information for my own trading, I post real-time trade ideas with exact entry and exit prices.)