Blackberry maker Research in Motion (RIM) has said it will delay the launch of its new phone operating system Blackberry 10 and is to cut 5,000 jobs.
The confirmation of job losses, which RIM had warned of last month, came as the firm reported a $518m (£334m) net loss in the three months to 2 June.
That compared with a $695m profit in the same period a year earlier.
Analysts said the results were worse than expected and the Blackberry 10 delay spelt more bad news for RIM.
Revenue in the first quarter dropped 43% to $2.8bn as sales of its Blackberry smartphones fell sharply for a second straight quarter.
RIM has struggled to keep up with rivals in the smartphone market, such as Apple's iPhone and handsets running on Google's Android operating system. It has also struggled to gain a foothold in the tablet market.
The Canadian firm had been pinning its hopes for a comeback on Blackberry 10.
The first phone with Blackberry 10 was expected later this year, but will now ship in the first quarter of 2013.
"Our first quarter results reflect the market challenges I have outlined since my appointment as CEO at the end of January," said RIM boss Thorsten Heins.
"I am not satisfied with these results and continue to work aggressively with all areas of the organisation and the board to implement meaningful changes to address the challenges, including a thoughtful realignment of resources and honing focus within the company on areas that have the greatest opportunities.
"Our top priority going forward is the successful launch of our first Blackberry 10 device, which we now anticipate will occur in the first quarter of calendar 2013."
Shares in RIM have fallen about 70% over the past year.
After the release of the first quarter results, its shares plunged 18% to $7.47 in extended trading in New York.
RIM also said it expected to make an operating loss in the current quarter.
"These [results] are brutal and it looks like it's going to continue to get worse before it gets better with this new wrinkle of the delay of BB10," said Eric Jackson, hedge fund manager at Ironfire Capital in Toronto.
"The company [is] now losing money. For a long time it's been able to say it's solidly profitable. And yet now it's starting to dip in the red and that's going to continue for several quarters.
"And there's really no guarantee that once they come out on the other side of BB10 that it's going to be something that people will want."
He also said that he thought the company would have to cut more jobs in the future.