It reported a quarterly loss of $66 million with revenues falling to $490 million in the quarter.
Analysts had expected that BlackBerry would turn over $610.6 million in the quarter.
Earlier this month, BlackBerry bought Good Technology in a bid to increase its market share in services.
The firm still remains committed to releasing smartphones and will release a phone later this year using the Android OS called Priv.
BlackBerry’s plan to turn its fortunes round depends on whether it can make more money from the services business.