Seeking Alpha

BlackBerry plunges 20%

  • Re-opened for trade after pre-announcing a near-$1B FQ2 operating loss and the planned axing of 40% of its workforce, BlackBerry (BBRY -19.8%) plunges into the single digits.
Comments (58)
  • I was a BBRY bull till late June where decided to cut my losses for good. Now looking at this, I am so glad I didn't become a bagholder.


    20 Sep 2013, 03:43 PM Reply Like
  • You should commend yourself for being able to read the writing on the wall. Losses avoided are just as good as gains made.


    I have no position in BBRY myself, but everytime I bring up the possibility of BBRY going the way of Palm (which I firmly believe) I get flamed by people on this sight like crazy. I really believe that Blackberry will not exist in its present form by the end of 2014.


    I wonder where all the BBRY bulls are hiding now after this hideous earnings report??? Is anybody out there? Anybody at all??? (echo... echo... echo)
    20 Sep 2013, 04:08 PM Reply Like
  • Unfortunately they were probably the 4500 getting the pink slips...
    20 Sep 2013, 04:16 PM Reply Like
  • Here! Holding the bag. Starting to feel like the Knight who has all his arms and legs cit off but still taunts the enemy in "The Holy Grail" (Monty Python's)
    20 Sep 2013, 04:24 PM Reply Like
  • Oh yes and BB can use that gratis for their next advertising campaign.
    20 Sep 2013, 04:25 PM Reply Like
  • Lucky you sold.


    Those who stayed long could have limited their downside by hedging. This was a way they could have gotten paid to hedge:
    20 Sep 2013, 04:41 PM Reply Like
  • I gladly admit to having been a bull, got out with a painfull loss of 1.5 percent all in all.


    Maybe this is totally crazy. But unless there's some quick action by sep 27 (if so I feel even more foolish of cause) I can't see this ending pretty.


    1.6 m for the quarter, thats 133333 for each unit per month. Insisting on making 4 units seems a bit to much the situation given. At the same time their BB7 is outdated, and they kind of need units for their other stuff to work.


    The still looking at strategic alternatives thats actually the most worrying part.
    20 Sep 2013, 05:32 PM Reply Like
  • WisPoker


    Remember I was the one saying they needed to layoff a lot of people and downsize the company to 2008 levels if not before. And I got flamed too.


    Can't say I celebrate being right as this is painful to watch.
    20 Sep 2013, 05:46 PM Reply Like
  • Tis a flesh wound!!


    +10 for the reference.
    20 Sep 2013, 06:43 PM Reply Like
  • Come back here and take what's coming to ya! I'll bite your legs off!
    20 Sep 2013, 06:57 PM Reply Like
  • and between all that debt they carry and shrinking market share probably doesn't even make sense to borrow cash to do buybacks.
    20 Sep 2013, 07:57 PM Reply Like
  • Thanks for getting it!
    20 Sep 2013, 08:26 PM Reply Like
  • How smart does Prema, Preza or Pizza or whatever his name is look now?


    Funny thing they were firing sales people last year. That sure did a lot of good. Now they are firing 4500 staff. Should have reversed the order.
    21 Sep 2013, 01:04 AM Reply Like
  • Anybody else upset that company halted trading an released their earnings 1 week ahead of schedule? Its like they are trying to lose money. They halted trading a couple weeks ago to announce they were looking for a buyer.
    21 Sep 2013, 11:04 AM Reply Like
  • I RIP'd $BBRY a long time ago. Zombie theory exploded -40%. Going to zero.
    20 Sep 2013, 03:50 PM Reply Like
  • OMG I was thinking of investing at $10...maybe it's going to $6 again?
    20 Sep 2013, 03:55 PM Reply Like
  • Down further then that my friend.
    20 Sep 2013, 04:08 PM Reply Like
  • Bloomberg (BBRY) analyst just stated that he thinks the break up value of the company will be in the range $7 - $7.50 per share so still has a way to fall!
    20 Sep 2013, 04:04 PM Reply Like
  • I had an urge to buy earlier today, but decided to buy $DUST instead, then the announcement came out, and it was a difference of plus several thousands and minus several thousands of dollars by the end of day. As a Canadian I really wish $BBRY to outperform, but as an investor we all need to be rational rather than emotional.
    20 Sep 2013, 04:12 PM Reply Like
  • Bought more after the announcement but it's still play money. Still want a Z30 and I'm crazy I guess. Just hope I can keep using BB10 it would be painful to go back to the back button and no hub.
    20 Sep 2013, 04:16 PM Reply Like
  • There's no shame in preferring BB phones but why in God's name did you buy the stock?


    Are you allergic to money? Next time you have the strong desire to part with your money just send it to me. I'll make sure it goes to good use.
    20 Sep 2013, 04:30 PM Reply Like
  • Don't bother BTM. I have tried...and tried...and tried...
    20 Sep 2013, 04:55 PM Reply Like
  • still just merely 133.333 per unit per month. And I Thought the Q10 would be doing better


    Is this the point of maximum pessimism I wonder
    20 Sep 2013, 05:57 PM Reply Like
  • Why not separate the product from the stock? But the first and don't touch the latter - given today's BBRY news, this is not going to end well...especially because MFST got NOK and the three medals are distributed in the smartphone race.


    Nobody (developers, most customers, carriers) wants a number four. It's hard to support three different OS already. Reality has to sink in with BBRY longs.
    20 Sep 2013, 08:25 PM Reply Like
  • No chance of BBRY being sold off whole now.


    BBRY will be picked apart on the cheap for Patents and BBM.


    BES will have to be sold for a fraction of its value as it just lost another 20% of its install base.


    Sad that management could have taken Microsoft's offer a few years ago and saved the company. At least Thorston Heins still gets his fat payday.


    20 Sep 2013, 04:22 PM Reply Like
  • This is spectacular news for Microsoft! With the WP enterprise pack coming, they'll have the premier business smart phone, and they'll own the market.
    20 Sep 2013, 08:00 PM Reply Like
  • Laughable people valued BBRY more than NOK
    20 Sep 2013, 04:32 PM Reply Like
  • Yeah ...I'm preparing a sign that says "Kick Me!"
    20 Sep 2013, 04:37 PM Reply Like
  • Yes, because "RIM makes tons of cash, Nokia is posting losses. "
    I remember being shoved with that on my face so often... and then again, I knew Blackberry was on a path to extinction, while Nokia had already a new plan in motion. In the end, I'm up about 50% on NOK and never touched RIM/BBRY. I've been following the RIM story ever since Cramer shouted "At $50 it's a buy, this stock will go to $70 in no time." Yeah, right.
    21 Sep 2013, 04:25 AM Reply Like
  • @mitrado


    How about " I'll bet Nokia goes under before BlackBerry. If BlackBerry had debt, it would be rated higher than junk status like Nokia's."


    You should have joined my bet with alext1379.
    21 Sep 2013, 06:05 AM Reply Like
  • I would like to know what BB was thinking when they halted trading for this and then re-opened it with only several minutes left in the day. I think they are trying to devalue the stock. It's working. Maybe Prem needs a cheaper entry level. The strategy is working real well.
    20 Sep 2013, 04:39 PM Reply Like
  • Maybe.You could be right . Or maybe the same thing they weren't thinking when they did not release sales numbers on their last earnings call. the stock dove after that one.. Either way sounds desperate to me.Like it or not mobile space is an app space
    20 Sep 2013, 05:13 PM Reply Like
  • @Loon-a-tick


    If that were the case, why didn't they announce it on Monday morning. A week of trading with news like that would surely tank the stock a lot further than a couple of minutes of trading.
    21 Sep 2013, 01:49 AM Reply Like
  • Too bad, great platform and that new 5 inch blackberry that just appeared in Malaysia with bigger battery sounds and looks very nice. Unfortunately BBRY got left behind in the app wars so did MS but latter just made up 170,000 apps "MS marketing style", and good to go for now. Offering "flagship" phones for free(with 2 yr) didn't hurt MS either market share wise. .
    20 Sep 2013, 05:10 PM Reply Like
  • Thorsten Heins' Three-Phase Transformation Plan and Vision @
    20 Sep 2013, 05:37 PM Reply Like
  • Is it
    Phase 1: Underpants
    Phase 2: ?????????
    Phase 3: Profit
    21 Sep 2013, 01:50 AM Reply Like
  • Oops. This is going to be very difficult for the BBRY pumpers to splain away.
    20 Sep 2013, 05:52 PM Reply Like
  • Can't explain. But it doesn't feel good. If you had to screw things up this last week I don't think you could do a better job. It is a "Perfect Screw Up".
    I'm suspicious of all this and would appreciate a regulator looking at the trials and tribulations of the last week.
    I think it is a manipulation but perhaps I'm just a bad loser. I knew the risks.
    20 Sep 2013, 08:31 PM Reply Like
  • Revenue expected to be $1.6B; nobody wants what they're selling!
    20 Sep 2013, 05:52 PM Reply Like
  • Well I took one on the chin and exited my position this afternoon at $9.79. The loss Erases my gains for the year in my portfolio. I still see them being attractive to a buyer but the start of the cash bleed has doom written all over it. Not sure how much the severance costs will be but they are now 3 weeks into the current Q and I doubt there will be any cash laying around for the buyer. That leaves services and patents. Could be upside here on a sale but I'm not sticking around to find out.
    20 Sep 2013, 05:54 PM Reply Like
  • I made a lot of money in the lead up last year (Nov to March), then sold out in April. I might jump in now to see if there's a contender to purchase this company.


    Regardless, RIM is dead.
    20 Sep 2013, 07:23 PM Reply Like
  • On Monday, BBRY will open at around liquidation value. The time to get in is now.


    The sum of the parts is well north of $8 per share.
    20 Sep 2013, 07:23 PM Reply Like
  • Agree, however liquidation value matters in this instance if a deal is highly probable. If not, the fact that NAV has been declining steadily due to cash burn gives less meaning to the fact that it now trades at a discount to NAV. Y Blackberry will not survive in current form? Whatever competitive advantage they had is quickly vanishing. They've become ants in a field with two big elephants Apple n samsung.
    20 Sep 2013, 08:01 PM Reply Like
  • No surprises here, this is all expected in the coming big change ahead. Now they have paved the way for the spin. Good to see they are focussed on cost cutting and cash. The breakup/refocus plan is well under way. The stock has plenty of volatility looking forward. Trade it.
    20 Sep 2013, 09:02 PM Reply Like
  • Wonder if there are bids on the table?? By releasing their earnings a week early they may have intentionally did this to lower their share price...then the low ball bids may actually look good. I know its a long shot but what made them release their earnings early???
    20 Sep 2013, 09:13 PM Reply Like
  • The BBY salesgeek told us the phones were only for BBRY die hard fans. From My Instablog post on Sept 16:
    Best Buy Store Reveals The Solution For BlackBerry: It's All BBM [Edit or Delete]
    I visited a Best Buy (BBY) mobile store over the weekend place strategically in an upscale mall that also has an Apple (AAPL) store and a Microsoft (MSFT) store as well. What was interesting was the staff at this store. They were young and very knowledgeable. The person who approached me was maybe 23 years old and on top of his game regarding smart phones and the companies behind them. He told me that they were not getting any more BlackBerry (BBRY) Z10s. He also said that the Q10 was available but he had to order it. I asked about the sales and he explained that they sold them to die hard BBRY fans but nobody was switching back from Android or IOS. Bottom line at Best Buy is they are not a BlackBerry supporter. But what happened next was actually very good news to me in terms of what may soon happen to BBRY. The young man was complaining that BBRY's app selection was light and that was their weakness in his opinion. But he then added the main ingredient to this post, namely he couldn't wait for the BBM messenger app to be approved for IOS. He said when he used the BBRY phone as a kid (I think he still is a kid) he loved the BlackBerry Messenger "BBM". He read that the BBM IOS app has been pending AAPL approval for two weeks. So then I found this in a recent article on the subject:


    "While there is a general feeling that BlackBerry should have launched its BlackBerry Messenger service for these platforms much earlier, the launch is still highly anticipated. Recently we discussed how Samsung is very busy pushing the BBM Android app and has been heavily promoting the app for its Galaxy devices." Tags: BBRY, MSFT, AAPL
    Sep 16 3:04 PM |Report Abuse|Link|Comment!
    20 Sep 2013, 09:18 PM Reply Like
  • BBM are you serious? This is your saving grace?
    20 Sep 2013, 09:28 PM Reply Like
  • This is what happens when there is clause in the CEO sign-on agreement: 'if you sell the company before leaving, you will get a multi-million dollar bonus.'


    Happened at Nokia. History repeating itself... TH was never interested in reviving the company. Makes me question the integrity of the board of directors at these companies.
    20 Sep 2013, 11:52 PM Reply Like
  • I wonder what their reasoning for pre-reporting this was, when they're in the midst of trying to sell themselves off.
    21 Sep 2013, 12:50 AM Reply Like
  • Ben,


    I think I answered this on another thread, but let's just toss it out again. There have been stories floating about for weeks about how crappy this quarter was going. The longs persisted in denying that newspapers or financial magazines or even the WSJ ever get their stories correct. I'll bet I saw the word conspiracy 50 times.


    The most reasoned of the longs asked for facts. Ah, between earnings releases, attributed facts are as scarce as polar bears vacationing in Belize. It is really difficult to keep a lid on a quarter as blown as this one with the threat of 40% of the workforce being fired and inventory recalled from carriers who DO NOT WANT IT anymore.


    There had been an earlier precedent where RIM warned in 2011 during a bad quarter when the earnings were still good and the stock around $50.


    We don't know who has been looking at the company in parts or total, but you can imagine their annoyance to be confronted with the rumor of the day - layoffs, cancelled production, salesforce being fired... Remember, the company cannot deny it if it is generally true. Simply to be ethical and 'tell it like it is', the company preannounced a miserable quarter and the steps being taken to downsize. Most everything you read about in the Journal or quotes from analysts on these pages was reasonably accurate.


    But the air is cleared and everyone can deal with the situation as they find they must. Some undoubtedly sold, tired of the promise that never arrived, burdened by years of loss. Others will swear they see a great value below $10. Too much depends on if anyone is stepping forward to claim a piece of the pie and if they are generous - unlikely and unnecessary - or frugal. If not, then rebuilding is up to management and the BOD.


    I wonder if in the self-help section at Barnes and Noble if there is a "Saving Your Company from Extinction - for Dummies."
    21 Sep 2013, 03:01 AM Reply Like
  • No doubt that there is manipulation in the announcing of these numbers just what...1 week before earnings? Why on earth unless there is the driving down the stock price so "someone" can pick up a company for a lot less.
    21 Sep 2013, 04:23 AM Reply Like
  • I find it suspicious $BBRY finds it necessary to pre-announce just before the market close on options expiration Friday. Why not after the close or on Monday morning? Why just before a bunch of PUT options expire worthless...Oh yeah, because those PUT options didn't expire worthless...
    21 Sep 2013, 04:27 AM Reply Like
  • Can this be intentional manipulation to tank the share price for interested buyer(s) regardless if sold as whole or partial?
    21 Sep 2013, 04:33 AM Reply Like
  • no, it can't.
    23 Sep 2013, 11:02 AM Reply Like
  • Well, it looks as if Prem Watsa will be taking the company private for at a very good price.


    It's as if those running the company want it to fail. Q1 results weren't brilliant but were in line with the previous quarters guidance, and were comparable or better than Nokia's early sales figures for its Lumia range. Simply issuing an earnings guidance a week or so before the Q1 results were released reiterating that the company expected to approach break-even as they had previously projected would prevented the eruption of negative sentiment that ensued.


    Then having fed the "Blackberry is doomed" narrative by simply failing to manage expectations they went and announced that they would explore strategic options, creating further uncertainty which has no doubt killed their sales over the past month. Even if the past quarter was a poor one they still had the Z30 and BBM for Android and IOS that would have created some positive buzz in the media going into Q3 and the leadup to Christmas.


    The problem now is that such a stench of failure permeates the whole company it will be extremely hard to gain any traction moving forward. Which is a shame as I think BB10 is an elegant piece of engineering and far more capable than most if not all of the competition and making BBM available to competing platforms could potentially generate a lot of revenue moving forward.


    If I were a Blackberry shareholder I'd be booking an appointment with my lawyer.


    21 Sep 2013, 04:34 AM Reply Like
  • At this rate, Prem Watsa will be taking Blackberry private at a very good price. Watching the last few months unfold it's as if those in charge are intent on driving the company into the ground.


    The results for Q1 while not brilliant weren't terrible and were in line with the previous quarter's guidance. If the company had issued an earnings guidance reiterating that a couple of weeks before announcing the Q1 earnings they could have prevented a lot of the negativity that has since engulfed the stock and kept control of the narrative.


    Then they had to go and announce that they were exploring strategic alternatives creating further uncertainty about the company's future and thereby killing sales this quarter. Now maybe this quarter wouldn't have been great anyway, but this almost certainly has cost them a good deal of sales, particularly enterprise sales, in the meantime making this quarter worse than it would have been otherwise.


    It's unbelievable. I'm sure the people running Blackberry are intelligent, but their management of the company these past few months boggles the mind.
    21 Sep 2013, 04:35 AM Reply Like
  • Same thing with Dell. They purposefully sabotage their company to be able to buy it cheaper. Blackberry could have easily waited the 1 week to release earning when they were supposed to. Halting the stock and releasing them early only makes sense if they are trying to lower the price.
    21 Sep 2013, 11:04 AM Reply Like
  • If this is BB way of giving guidance then good grief! Just pathetic management for the investors, excellent for TH. He gets a large bonus if the company is sold off. As always, screwing your investors and users.
    22 Sep 2013, 12:11 AM Reply Like
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