BlackBerry bloated by $1bn inventory as it warns on Q1 losses

Bloomberg stats claim in-house stockpile has ballooned to more than $1bn as CEO Heins broods on "challenging" year ahead

RIM is bracing for another torrid year as its in-house inventory stockpile has reportedly grown past the $1bn mark.

Thorsten Heins, chief executive of the embattled Canadian vendor, issued a business update yesterday explaining that the firm is expecting to post an operating loss for its first fiscal quarter, which closes on Saturday. The BlackBerry boss added that "our financial performance will continue to be challenging for the next few quarters".

"The ongoing competitive environment is impacting our business in the form of lower volumes and highly competitive pricing dynamics in the marketplace," he said. "We are continuing to be aggressive as we compete for our customers' business – both enterprise and consumer – around the world, and our teams are working hard to provide cost-competitive, feature-rich solutions to our global customer base."

Figures compiled by Bloomberg claim the value of the vendor's own inventory has climbed to $1.03bn (£660m), not including any stock currently held by partners or retailers. This compares with stockpile levels of $618m a year ago and less than $500m in summer 2008, when BlackBerry sales were at their most fevered.

In a bid to arrest its current slide, RIM is currently implementing the CORE (cost optimisation and resource efficiency) programme, which it claims will provide savings of $1bn by the end of the current fiscal year. Rumours emerged this week that the firm could be set to make more than 2,000 redundancies.

The firm has not commented directly on the speculation, but in today's statement Heins outlined that resources in certain segments will have to be scaled back drastically.

"While there will be significant spending reductions and headcount reductions in some areas throughout the remainder of the fiscal year, we will continue to spend and hire in key areas such as those associated with the launch of BlackBerry 10, and those tied to the growth of our application developer community," he said.