BlackBerry Ltd (BBRY) Ends Licensing Deal with T-Mobile US Inc (TMUS)

BlackBerry Ltd (NASDAQ:BBRY) (TSELBB) announced its decision not to renew its licensing agreement with T-Mobile US Inc (NYSE:TMUS) to sell its BlackBerry smartphones. Its current contract with the fourth largest wireless carrier in the United States expires on April 25, 2014.

In a statement, BlackBerry CEO John Chen said the company “has a positive relationship with T-Mobile for many years,” but he expressed regret that their strategies do not complement each other. According to him, “We must act in the best interest of our BlackBerry customers.

In addition, Chen said, “We hope to work with T-Mobile again in the future when our business strategies are aligned. We are deeply grateful to our loyal BlackBerry customers and will do everything in our power to provide continued support with your existing carrier or ensure a smooth transition to our other carrier partners.”

The decision came after a squabble between the Canadian smartphone manufacturer and U.S. wireless carrier. T-Mobile US Inc (NYSE:TMUS) released a promotional campaign wherein it offered discounts on the iPhone for consumers who wants to upgrade their BlackBerry smartphones.

Chen was outraged and described the marketing promotion of T-Mobile US Inc (NYSE:TMUS) “inappropriate and ill-conceived. T-Mobile CEO John Legere apologized for any confusion and stated that they are “happy to be a partner of BlackBerry.”

BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) said consumers who own BlackBerry smartphones under the network of T-Mobile US Inc (NYSE:TMUS) will enjoy the same service or support. The Canadian smartphone manufacturer said it work closely with the U.S. carrier to ensure that BlackBerry users or any customer who will purchase from T-Mobile’s existing inventory will receive the best possible service.

Last week, the Canadian smartphone manufacturer reported $976 million revenue for its fiscal fourth quarter, a 64% decline from its $2.7 billion revenue in the same period last year. BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) posted $423 million or $0.80 per share GAAP losses from continuing operations. It sold it sold 3.4 million BlackBerry smartphones during the quarter.

Chen said he is pleased with the company’s progress and execution during the fourth quarter compared with its strategy three months earlier. “We have significantly streamlined operations, allowing us to reach our expense reduction target one quarter ahead of schedule. BlackBerry is on sounder financial footing today with a path to returning to growth and profitability,” said Chen.