BlackBerry (NASDAQ:BBRY) reports earnings for its fiscal first quarter on Friday, the first full quarter impacted by sales of its new BlackBerry 10 smartphones, but financial analysts disagree over how sales and profits will shake out for the company as it charts its comeback.
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BlackBerry's new Secure Work Space is now available for Android and iOS devices. |
Some analysts are upbeat that sales of the touchscreen Z10, and the physical keyboard-toting Q10 in particular, will help revive demand. Others have a more negative outlook. BlackBerry executives have provided little in the way of direction.
"The die-hard BlackBerry installed base of 76 million subscribers loyal to the keyboard presents a strong upgrade opportunity," Wells Fargo analyst Maynard Um recently told Bloomberg.
Similarly, according to AllThingsD, William Blair & Company analyst Anil Doradla wrote in a research note that that BlackBerry is benefiting from a refresh cycle, with the potential for demand to keep going for the next few quarters. "We expect a two-quarter uptick in BlackBerry's hardware sales, based on the phased global launch and pent-up demand from a portion of BlackBerry's 75 million-plus subscribers," Doradla wrote. "With Q10 in particular, we believe we are witnessing a BlackBerry 10 refresh cycle."
The Q10 went on sale earlier this month from Verizon Wireless (NYSE:VZ), AT&T Mobility (NYSE:T) and T-Mobile US (NYSE:TMUS) and is expected to be available from Sprint Nextel (NYSE:S) this summer. BlackBerry CEO Thorsten Heins has said that the company expects to sell "tens of millions" of Q10 devices. The company also recently launched the Q5, which has a physical keyboard, aimed at emerging markets.
However, as AllThingsD notes, BlackBerry executives have been somewhat opaque when discussing sales. "BlackBerry's leadership has understandably tried to build an aura of success around its new BB10 devices, including breathlessly buzz-worthy quotes such as 'BlackBerry tripled its best-ever performance for a new phone in the U.K.,' and the launch of the Z10 'was the more than 50 percent better than any other launch day in our history in Canada,'" Pacific Crest analyst James Faucette recently wrote in a research note. "Never mind that most previous high-profile launches were single-carrier exclusives, while the Z10 launched on most major carriers in those key markets simultaneously. However, BlackBerry's management has declined with unfailing consistency to disclose actual BB10 activation figures even when addressing direct questions from investors and press."
"The initial enthusiasm that we observed for BlackBerry 10 devices now appears to be waning," Bernstein research analyst Pierre Ferragu wrote in a note last week to clients, according to Reuters.
Meanwhile, BlackBerry formally unveiled a solution that will separate and secure work and personal data on mobile devices for third party platforms, including Google's (NASDAQ:GOOG) Android and Apple's (NASDAQ:AAPL) iOS. A similar feature, called BlackBerry Balance, is a core part of BB10. The new feature, called Secure Work Space, will be managed through BlackBerry Enterprise Service 10. BES 10 already offers mobile device management capabilities for Android and iOS devices.
The new security service, which BlackBerry previewed in March, is another one of BlackBerry's attempts to make the best of the bring-your-own-device trend in the market. BYOD has helped erode BlackBerry's market share the past several years as people bring their Android smartphones and iPhones to work and use them as their enterprise devices. BlackBerry said the new service will allow enterprises and governments to more easily and securely support BYOD policies for iOS and Android devices.
BlackBerry said it has installed around 18,000 BES 10 servers since the system launched in January, and that figure is up from a little more than 12,000 servers one month ago, according to Reuters. BlackBerry also said more than 60 percent of U.S. Fortune 500 companies are testing or using the system.
- see this AllThingsD article
- see this BlackBerry release
- see this Reuters article
- see this CNET article
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