BlackBerry back in profit, sells 1m Z10s

Discussion in 'Travel Technology' started by GoodBoy, Mar 28, 2013.  |  Print Topic

  1. BlackBerry back in profit, sells 1m Z10s
    • BY:ROB GILLIES
    • From:AAP
    • March 29, 2013 12:28AM
    RESEARCH In Motion says it sold about one million of its critically important new BlackBerry 10 devices and surprised Wall Street by returning to profitability in the most recent quarter.
    The earnings provide a first glimpse of how RIM's new touch-screen BlackBerry Z10 is selling internationally and in Canada since its debut on January 31.
    The one million Z10 phones exceeded the 915,000 analysts had been expecting.
    The BlackBerry, pioneered in 1999, had been the dominant smartphone for on-the-go business people and other consumers before the iPhone debuted in 2007 and showed that phones can handle much more than email and phone calls.
    RIM faced numerous delays modernising its operating system with the BlackBerry 10. During that time, it had to cut more than 5000 jobs and saw shareholder wealth decline by more than $US70 billion ($A67 billion).
    In the quarter that ended March 2, RIM earned $US98 million, or 19 US cents a share, compared with a loss of $US125 million, or 24 US cents a share, a year earlier. After adjusting for restructuring and other one-time items, RIM earned 22 US cents a share. Analysts surveyed by FactSet had been expecting a loss of 31 US cents.
    Revenue fell 36 per cent to $US2.7 billion, from $US4.2 billion. Analysts had expected $US2.82 billion.
    Despite the BlackBerry 10 sales, RIM lost about three million subscribers to end the quarter with 76 million.
    Bill Kreyer, a tech analyst for Edward Jones, called the decline "pretty alarming".
    "This is going to take a couple of quarters to really see how they are doing," Kreyer said.
    RIM, which is changing is formal name to BlackBerry, said it expects to break even in the current quarter.
    "To say it was a very challenging environment to deliver improved financial results could well be the understatement of the year," chief executive Thorsten Heins said during a conference call with analysts on Thursday.
    "I thought they were dead. This is a huge turnaround," Jefferies analyst Peter Misek said from New York.
    Misek said the Canadian company "demolished" the numbers, especially its gross margins. RIM reported gross margins of 40 per cent, up from 34 per cent a year earlier. The company credited higher average selling prices and higher margins for devices.
    The company also announced that co-founder Mike Lazaridis will retire as vice-chairman and director.
     
  2. kyunbit
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    kyunbit Silver Member

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    surprising given that I read a few days ago I read that shops are having a hard time selling Z10s
     
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  3. canucklehead
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    canucklehead Gold Member

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    The quarterly report would have excluded the US market sales as it ended March 2nd. I think the hardest sales problem BB has is in the US where its market share is pretty low. IF NYC is an example, it does not look like the stores are really flogging the Z10, though Verizon Wireless begins presales today and another vendor, Brightstar was reputed to have placed an order for 1M Z10s a couple of weeks ago.
     
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  4. non US sales have been reasonable since end of Jan when released
     
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  5. Mike Reed

    Mike Reed Gold Member

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    Two things of note:
    • they 'sold' 6mm devices, meaning customers chose a non-BB10 device 5-to-1
    • they lost 3mm subscribers in the quarter
     
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  6. 5:1 is 20% of the market, i would think that's pretty encouraging when taking into account i phones and all the droid models they're up against, i know they have much lower market share in the US, historically, Canada and the UK they've done much better
     
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  7. Mike Reed

    Mike Reed Gold Member

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    No no - not against the market, against other BB devices. Their own customers are not buying the new device, instead opting for older ones. 5:1 old blackberry to new one. The new one is NOT catching on.

    In the market overall, BB is essentially a very minor player at this point vs Apple, Samsung, HTC and Motorola.

    Sent from my iPhone using milepoint
     
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  8. Make-or-break BlackBerry posts small profit
    • From:AFP
    • March 29, 2013 10:02AM
    SHOWING signs of fresh life, smartphone maker BlackBerry eked out a small profit in a transition quarter in the midst of its rollout of a make-or-break platform to challenge Apple and Android.
    The Waterloo, Ontario firm said profit in the fourth fiscal quarter ended March 2 was $98 million, compared with a loss of $125 million in the same period a year earlier.
    The results come as the company conducts a phased rollout of new smartphones based on the new BlackBerry 10 platform, seen as its best hope at regaining traction after suffering staggering losses in market share in recent years.
    The group said it shipped six million smartphones in the quarter, including around one million BlackBerry 10 units, while its subscriber base slid by three million, to 76 million.
    The company unveiled its new platform on January 30, as it dropped the corporate name Research in Motion to rebrand as BlackBerry. But sales launches have been staggered, based on region.
    The quarterly data included some sales of the new phones in Canada, Britain, India and Indonesia. In the United States, the new phones went on sale just last week in what some analysts called a disappointing debut.
    "We have implemented numerous changes at BlackBerry over the past year and those changes have resulted in the company returning to profitability in the fourth quarter," said president and chief executive Thorsten Heins.
    "As we go into our new fiscal year, we are excited with the opportunities for the BlackBerry 10 platform, and the commitments we are seeing from our global developers and partners."
    Heins told a conference call that BlackBerry was getting strong interest from app developers, with more than 100,000 now available.
    "Early indicators are that BlackBerry 10 users are hungry for applications, and we're getting more commitments from global app developers daily as our launch continues its rollout."
    In the past quarter, revenue slid to $2.7 billion from $4.2 billion a year earlier and was below analyst estimates of $2.84 billion.
    But the profit excluding special items of 22 cents a share was a surprise, as analysts had expected a loss of 29 cents a share.
    An early rally in BlackBerry shares faded and the stock lost 0.87 percent to close at $14.44.
    Analyst Brian Modoff at Deutsche Bank said the latest results had both positives and negatives.
    "While the company had a moderately successful launch of the Z10, we highlight that there is a long way to go and believe they still have significant challenges," he said.
    "The challenges at the company are still daunting and we think the next few quarters will go a long way towards determining their success."
    Peter Misek at Jefferies was upbeat, saying BlackBerry is working to reduce reliance on phone sales and offer its secure software to rivals.
    "While most near-term focus continues to be on the phone, we believe BlackBerry's mobile device management opportunity is underappreciated," he said.
    This software "will gain traction throughout this year and see a significant ramp in revenues next year," Misek said in a note to clients.
    But Paul Ausick at 24/7 Wall Street said the profits masked some bleak figures on lower-than-expected shipments and the loss of subscribers.
    "Not a very auspicious start for the renamed company with the brand new smartphone," he said.
    AFP
     
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  9. i wonder if it will take a while for current BB users to get the swing of using the on screen style typing? BB users may well be conservative late adopters
     
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  10. Mike Reed

    Mike Reed Gold Member

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    I think people, especially companies, are tired of paying the $15/month blackberry tax for a corporate data plan, which isn't required on android and iPhone devices.

    Sent from my iPhone using milepoint
     
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  11. viguera
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    viguera Gold Member

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    I think there's a huge push for the "bring your own device" approach, but the options out there (both on the front-end and management) are really dismal. "Good" is supposedly the best of them, and if you ask anybody that has used it for a considerable amount of time, it's actually quite terrible. If you ask the people managing it, they hate it even more.

    But this approach switches the expense of running a huge mobile computing plant to the end user (or at least a good deal of it), so companies love it. The end user thinks he's getting a good deal because he gets to use his iPhone/Android phone instead of the supposedly antiquated Blackberry, only to find out that now his "personal" phone needs extra security measures, plus he's incurring the cost and using his "personal" data plan for corporate email.
     
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  12. I'm a late adopter to on screen typing and I love it as it gives me more screen to view stuff and the key pad is very inutitive. Its now forming words ahead of my fingers.
     
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  13. Singapore Flyer

    Singapore Flyer Silver Member

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    Or work for a place that will pick up the data plan ad throw in free text messaging and an unlimited global data plan. :)
     
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  14. Mike Reed

    Mike Reed Gold Member

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    Caveat: I work in the industry. :)

    BYOD is already passé in terms of deployment approach - many corporations are looking at a dual-model again where they're issuing devices, often tablets, and it's referred to as COPE (Corporate Owned, Personally Enabled).

    As for management solutions, that's a market that's changed pretty radically in the past 6 months.

    And you're right, the user experience with Good Technology is it's biggest downfall. If the product you're using to help manage and enable mobile devices in your environment doesn't support secure native experiences, it's the wrong product.
     
  15. youpaiyou

    youpaiyou Silver Member

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  16. viguera
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    viguera Gold Member

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    I hear you, but you and I know companies will go where they think they'll save money. BYOD was stupid but most of the companies out there had really good salespeople, and they threw all kinds of numbers at people saying how they could have a millioin here or a million there, so products that are "not as good" ;) got a good foothold.

    "My friend" works in the industry as well, although he's not allowed to say much. They've been testing MDM solutions from everyone, including the Blackberry folks, Mobile Iron, AirWatch, whatever, and as always the engineering guys find out that most of these things are -- at best -- slapped together solutions that don't scale well when you start looking into tens of thousands of people.

    That's why I think Blackberry will do well in the long run though... they've been doing the end-to-end management of devices and integration "the right way" for a very long time, while everyone was concentrating on the consumer market. I think it will be hard for them to get a significant foothold on the consumer end (unless it's the diehard fans), but more and more companies are finding out that all the other solutions out there are just really, really bad. :)
     
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  17. Mike Reed

    Mike Reed Gold Member

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    I work for MobileIron, so I'd be willing to dispute the scale numbers, but that would get into a sales pitch... which I'm sure nobody wants. I'm happy to provide some pointers in PM's, though, for interested folks.

    Blackberry, IMO, is dead unless they open up to integration with the major EMM (formerly MDM) players. Their "Blackberry only" approach just doesn't hold water in a world with mixed iOS, Android, Windows Phone and MobileOS new-whaterver-is-next. And it's sad, too, because I had a first-gen RIM device the year it came out. They defined this market... then, like Nokia, fell of the edge of the earth.

    Like Sprint, though, they have enough government uptake that they'll continue a run-rate business for a long time to come (they're the CA of the mobile industry).
     
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  18. viguera
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    viguera Gold Member

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    I agree, and they know, since that's what they've been getting from all their customers. Why am I paying x, y and z player PLUS RIM, to manage separate devices with separate solutions?

    But this is where they have the advantage (and they know it, as they're making their Android / iPhone / Windows Phone management solution integrated into BES 10 available in June). Nobody was going to go in and try to sell a solution to manage Blackberry devices, that was just not going to work, because they were too entrenched in the enterprise. So the MDM vendors came up with ways to manage other devices. And RIM therefore has the upper hand, because now they can sell a solution that manages Blackberry devices (as they always had) plus Android / iOS and everything else.

    Whether that solution will be too little too late remains to be seen, and the dependency on BES 10 can be a problem (since most companies will be slow to adopt because the audience for BB10 devices is just not there). Then again, this is probably their Hail Mary pass though... hoping that the enterprise will say "we'll adopt BES 10 and drop [insert MDM solution here]" since they already have a working relationship with RIM, and this will let them manage everything that the users have.

    I think either this will work, and they'll thrive in the enterprise while other companies remain on the fringe OR they'll die a spectacular death, which is better than just slowly decaying like some other companies have done.
     
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  19. Mike Reed

    Mike Reed Gold Member

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    I'd assert that no OEM has incentive to manages competitor's devices as well as their own. You'll never see Apple put work into parity for Android, Windows and Blackberry, and you'll never see Google provide parity for iOS, etc. In the same way, while Blackberry will be able to manage multiple device families, you won't get the "best" experience on anything other than a Blackberry.

    That's where the current crop of third-party solutions shine (much like third-party desktop management/patch management) - they have incentive to provide the best experience each platform can offer.

    And, FWIW, many of them can do some BASIC BB management (but aren't a BES replacement) - and with BB10 being ActiveSync manageable, that provides some BASIC security to third-party EMM systems, but not nearly to the degree of a BES for BB devices.

    You're right, though, we'll definitely see where the market goes.
     
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  20. HaveMilesWillTravel
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    HaveMilesWillTravel Gold Member

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    Apple and Samsung, yes... but HTC and Motorola? They aren't exactly prospering themselves these days and aren't in the top five smartphone vendor list of IDG for Q4 2012 (neither is RIM), and HTC is about even with RIM for all of 2012.

    http://www.idc.com/getdoc.jsp?containerId=prUS23916413#.UVX9_FuG2B7
     
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  21. HaveMilesWillTravel
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    HaveMilesWillTravel Gold Member

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    Bingo :)
     
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  22. Tenmoc
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    Tenmoc Gold Member

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    Motorola is now google owned. You have to think of them as a top dog in this game. Even if they're still clearing out moto products before the google designed ones hit, they're going to be a heavy handed manufacturer.
     
  23. HaveMilesWillTravel
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    HaveMilesWillTravel Gold Member

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    I know.

    We'll see. Not everything that Google designs is a success in the market. Google TV and Nexus Q are some examples (both of which I have).

    As of now, though, they are a "no-show" in the top manufacturer stats.
     
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  24. canucklehead
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    canucklehead Gold Member

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    Here is an interesting article on BB's strategy going forward.

    BlackBerry product line that will have three tiers: smartphones for high end users, as well as variations that sell at mid- and "entry-level" prices.
    ...
    ...the company will release another round of BlackBerry 7 models in some countries, which continue to use the old operating system.
    ....
    "We're not excluding those markets from BlackBerry 10 because of us wanting to sell BlackBerry 7. You will see both in coexistence for awhile in those markets."
     
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  25. http://www.theglobeandmail.com/news...il-new-smartphones-this-year/article10561144/
    Here 's the video interview with Heins talking about future devices.
     
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