BlackBerry (BBRY) has a lot of momentum as its approaches the release of its Q1 results later this month, with market share gains in key markets now in evidence. The Internet discussion of BlackBerry's outlook and progress has displayed polar opposite views, with Pacific Crest Capital and Detwiler Fenton & Co. offering very negative views on the company's prospects, while more bullish reports have emerged from Wells Fargo and Societe General. We will find out who is right and who is wrong on June 28, 2013, when the company releases its Q1 results.
BlackBerry did not attempt a worldwide launch of its new products simultaneously but proceeded with a "rolling" launch beginning with markets where it had a strong base of users and a solid following and concentrating its efforts to make sure that it could support demand with sufficient inventory in each market. Notwithstanding those efforts, there were reports of stock-outs and shortages from time to time.
Investors have been looking for some hard data to form a judgment on the progress the company is making, with strong bearish views in some quarters and strong bullish views in others. With a short position on the stock widely reported and approaching 35% of the outstanding shares, the stakes could hardly be higher for investors or for the company.
Anecdotal evidence is plentiful but not that helpful. To try and give some harder data on the success or failure of the BB10 launch, I have updated charts from StatCounter Global to present just the June 16, 2013 data for three markets that were among the first to receive BB10 products - Canada, the United Kingdom and South Africa.
In Canada, the success has been striking. According to StatCounter's data, BlackBerry has displaced Android as the second most popular mobile OS in the country with a remarkable recovery to an approximately 30% market share.
The United Kingdom was among the first to get the new BB10 devices and was received with enthusiasm. As of June 16, 2013, BlackBerry has emerged with a strong third place in the United Kingdom with an 18% share of market.
BlackBerry has always had a significant share of market in South Africa, another country which received the new devices early in the launch schedule. As of June 16, 2013, BlackBerry is the number one OS in South Africa, holding a commanding 40% share of market.
Of course there are a lot more markets than these three, and BlackBerry faces formidable challenges in each. Its success or failure in the United States market is a key to its longer-term viability, and we have very little information other than anecdotal including, of course, the widely publicized announcement that it had one order for 1 million BB10 phones.
At this point, we are so close to earnings release that trying to second guess the results is a mugs game and I am not going to attempt it. Suffice to say that, at least in my view, BlackBerry's success in Canada, the United Kingdom and Canada alone should be enough to ensure that it reports results that most will find satisfactory. The discussion will turn to the outlook rather than the quarter, and that outlook will include early indications of how well BlackBerry is doing in the United States as well as how well-received its BES 10.1 management software has been.
The introduction of the lower-priced Q5 and the decision to make BBM available on Android and iOS devices is another area where investors will want information on the reception of these moves and the enthusiasm, or lack thereof, among users in all markets.
Ever the optimist, I am long BBRY.