BlackBerry on Friday reported smartphone and tablet sales...

the struggling company to report a profit and somewhat higher shipments of smartphones using its new BlackBerry 10 operating system than the 2.7 million units that it reported. The company shipped 6.8 million smartphones in Q1, up from 6 million in Q4, said Chief Financial Officer Brian Bidulka on an earnings call. But shipments were down from 7.8 million in Q1 last year. About 40 percent of the smartphones shipped were BlackBerry 10 models, said Bidulka. BlackBerry also shipped about 100,000 PlayBook tablets in Q1, it said. That was down from about 260,000 in Q1 last year. BlackBerry didn’t say how many PlayBooks were sold to consumers. Although the company will “eventually” move all its smartphones to BlackBerry 10, it no longer plans to do that with the PlayBook, said CEO Thorsten Heins. The company spent a lot of time looking for solutions to move the tablet to BlackBerry 10, but was “not satisfied with the level of performance and user experience” on the device, he said. Therefore, it made a “difficult decision to stop these efforts and focus on our core hardware portfolio,” he said. BlackBerry 10 is “still in the early stages of its transition,” said Heins, pointing out the new operating system launched five months ago. The plan is to have no more than six new devices on the market at any time, he said. The BlackBerry Z10 is now available in 147 countries including the U.S. and has been an “effective launch product” for BlackBerry 10, he said. The BlackBerry Q10 is now available in 96 countries including the U.S. and is expected to expand into 50 more countries in Q2, he said. The BlackBerry Q5, a lower-end model targeted at emerging markets, shipped in Dubai and 106 carriers in 59 countries are expected to launch it in Q2, he said. Despite the focus on BlackBerry 10, the existing BlackBerry 7 customer base “remains an important market to us,” said Heins. “Many emerging markets continue to purchase” those phones, he said. Q1 revenue grew 9 percent to $3.1 billion from Q1 last year. BlackBerry’s loss narrowed to $84 million, or 16 cents a share, from $518 million, or 99 cents. Hardware revenue grew 33 percent from Q4 to about $2.2 billion and made up 71 percent of revenue, up from about 61 percent in Q4, said Bidulka. Twenty-six percent of revenue was from services and 3 percent was from software and other sales, the company said. Inventories grew by $284 million to $887 million from Q4, mainly to support the continued BlackBerry 10 launch, said Bidulka. Heins was “encouraged” that three of its four regions returned to revenue growth in Q1 as BlackBerry 10 continued to roll out, he said. Its largest region, Europe, Middle East and Africa, made up 43 percent of revenue and was up 9 percent from Q4, said Bidulka. North America made up 25 percent of revenue and was up 30 percent from Q4, while Asia Pacific made up 17 percent of revenue and was up 35 percent from Q4, he said. Latin America, however, represented 15 percent of revenue and was down 6 percent from Q4, he said. The new fiscal year will be a “year of investment” for BlackBerry that will include significant marketing efforts to back the ongoing BlackBerry 10 launch, said Heins. Over the next three quarters, it will be increasing investments to support the rollout of new products and services, he said. As a result, it expects an operating loss for Q2, he said. But Q2 results are “very difficult to estimate during this transition in what remains a highly competitive smartphone environment,” said Bidulka. A year ago, the company made a “tough decision” in delaying the BlackBerry 10 launch until early 2013, said Heins. BlackBerry is a “leaner, more efficient” company now, he said.