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- BlackBerry finds an interloper on its home turf of security and privacy.
- Blackphone announces a privacy-focused app store and device sandboxes will be available in early 2015.
- The Blackphone offers granular permissions management for apps, with secure voice and text messaging.
- BlackBerry strikes back at newcomer Blackphone.
- Are Blackphones selling?
BlackBerry Finally Takes E-Commerce Seriously, Hardware Looking Bullish
- BlackBerry's device sales have been rising thanks to improved e-commerce solutions.
- Several devices have been planned for the future so the company will not abandon the smartphone business.
- BlackBerry has become more aggressive in North America and is seeking some of Apple's market share.
- Kantar Worldpanel data projects steep 50% + market share declines for BlackBerry in most smartphone markets.
- By applying the market share changes to last year's Hardware revenue, projections of revenue can be made for BlackBerry's fiscal 2015 Q3, to be reported this Friday.
- Based on this analysis, BlackBerry unit sales will decline to about 0.96 million from last year's 1.9 million (revenue recognized), with Hardware revenue declining by more than 50%.
- BBRY reports Q3FY15 on Friday with consensus expecting $937m in revenue and -$0.05 in EPS.
- SAF erosion expected and this has largely factored into the recent -18% m/m decline.
- Further downside risk could come from handset margin and shipments.
- BlackBerry Limited (BBRY) is slated to report 3Q 2015 earnings before the bell on Friday, December 19th.
- Adjusted Earnings Per Share: The Street estimate is -$0.05 (range -$0.16 to $0.05).
- Revenues: Analysts expect a decline of 20.5% y/y to $948.82 mln (range $836.70 mln to $1.19 bln).
BlackBerry Revenue Streams To Increase With New Business Unit
- BES 12 includes Internet of Things (IoT) Technology.
- BlackBerry focusing on healthcare with IoT.
- New business unit working with Industrial Internet Consortium.
- Recent data point to higher device sales.
- Passport and Z3 seem to be the better performers.
- I expect BlackBerry to sell 3 million smartphones in Q3.
- If it does, it should show a surprise profit.
Blackberry And NantHealth: A Good Start But A Long Way To Go
- BBRY and NantHealth will introduce a genome browser as early as next year.
- Targeting niche verticals in healthcare is the right strategy for BBRY.
- The project is at an early stage so it's unlikely to move the needle. I prefer Lenovo and QIHU.
BlackBerry Secusmart: iPhone-Specific Signal App Doesn't Make It Irrelevant
- BlackBerry's Secusmart acquisition further strengthens its security portfolio.
- Secusmart offerings are much safer than the Signal app.
- Signal app won't make BlackBerry's Secusmart acquisition irrelevant.
- In July of 2014, BlackBerry announces a deal to acquire secure communications provider Secusmart.
- In July of 2014, renowned security professional and privacy activist Moxie Marlinspike announces availability of Signal for iPhone.
- Vodafone and Secusmart create software-only encrypted voice app for iPhone.
- Analyzing the competing offerings.
- Five catalysts will likely propel BlackBerry to a profit earlier than expected.
- CEO John Chen's quotes provide some pretty clear guidance, but the shorts just say "la, la, la."
- BlackBerry is still in the grip of short sellers who are about to get the surprise of their lifetimes.
BlackBerry Gets Closer To German Government, We Think $15 Still Reasonable
- BlackBerry received some nice press for its work with the German government.
- BlackBerry stock has pulled back since the company's investor day.
- Morgan Stanley downgraded the stock last week, contributing to the pullback.
- With the Classic on deck and renewed confidence from the German government, we continue to like BlackBerry and keep our $15 price target.
Yes, BlackBerry Can Run A Promotion And Still Make Money; No, It's Not A Sign Of Desperation
- BlackBerry announced a program for iPhone users to trade up to Passport.
- Without carrier marketing support for the important U.S. holiday selling season, BlackBerry must market the Passport on its own.
- BlackBerry will not lose money on this initiative.
Taking A Closer Look At BlackBerry's EZ Pass Program And BES10 Uptake
- BlackBerry hopes enterprise customers will upgrade away from its Free Perpetual Silver Licenses offered as part of the EZ Pass Program.
- The EZ Pass Program puts a stake in the heart of BlackBerry’s once lucrative Service Access Fees-based business model.
- BlackBerry’s claim of 25% - 33% of EZ Pass Program participants "trading in" licenses from competing platforms is highly misleading.
- John Chen, BlackBerry CEO, gets tough with the other MDM solution providers - "I have a message."
Is BlackBerry Actually Going To Save $800 Million In Intellectual Property Costs?
- It appears BlackBerry will save approximately $800 million in intellectual property costs versus FY2014 levels, although the effect is approximately $300 million annualized when measured against Q2 FY2015 levels.
- BlackBerry hardware gross margins are estimated at between 14% to 19% for the first two quarters of FY2015, excluding inventory charges and the fixed intellectual property costs.
- This is consistent with the hardware gross margins of brands that are strong in the developing world. Passport and Classic sales will likely boost gross margins.
- Based on a more detailed look at hardware gross margins, it appears likely that BlackBerry can reach profitability at 13-14 million units, rather than the 17.5 million I mentioned before.
BlackBerry Needs To Sell 8MM - 9MM Smartphones To Meet FY16 Revenue Bogey
- Morgan Stanley downgraded BlackBerry to "Underweight" due to concerns over revenue projections.
- FY16P service and software revenue of $850MM and $500MM, respectively, implies the bogey for handsets/other revenue is $2.45B.
- At a price of $275 - $300 per unit, BlackBerry needs to sell 8MM - 9MM handsets in FY16.
- CEO John Chen previously estimated 10MM units sales were needed to break-even. I'm all in.
Yesterday, 12:57 PM
- A month after launching several new enterprise services to go with BES12, BlackBerry (BBRY +3.8%) has rolled out two app/services bundles for enterprise users.
- The Secure Productivity bundle features BlackBerry's VPN Authentication service, BBM Protected (messaging security), BlackBerry Blend (remote PC/tablet data access), and customer support.
- The Enterprise Communicator bundle features BBM Meetings (a cross-platform conferencing app), BBM Protected, and customer support.
- BlackBerry is charging $6/user/month for the Secure Productivity bundle, and $12/user/month for the Enterprise Communicator bundle, to enterprise customers with BES and BB10 phones.
- Prior BlackBerry coverage
Yesterday, 12:41 PM
- The Classic sports a 3.5", 720x720 touchscreen to go with a full QWERTY keyboard. It runs on a dual-core Qualcomm Snapdragon 800 processor (released back in 2012), and has an 8MP rear camera to go with a 2MP front camera.
- BlackBerry (BBRY +3.7%) is selling the phone for $449 unsubsidized. The 16GB iPhone 6 goes for $649, and BlackBerry's recently-launched Passport (4.5" screen, abbreviated keyboard) goes for $499 through a holiday season promo. The device is "now available through local carriers around the world," and through BlackBerry's site and Amazon. U.S. carriers haven't begun selling it yet.
- "The Classic is a beautiful, nostalgic mess," says MobileSyrup in a mixed review. It calls The Classic "a good phone with ample battery life," but also thinks BlackBerry's "inconsistent implementation of hybrid trackpad/touch support makes for a frustrating experience."
- InfoWorld is more charitable: It calls the Classic "the best smartphone [BlackBerry] has ever released," one that will appeal to QWERTY loyalists. But it also doesn't see the device luring away many iPhone/Android users. The Globe and Mail isn't a fan. "I am in the mainstream when I say I don’t prefer physical keys."
- While cheaper phones such as the Z3 are aimed at emerging markets, BlackBerry is counting on the Classic and Passport to help it maintain a high-end niche among enterprise/government users and keyboard enthusiasts. Gartner recently put BlackBerry's Q3 smartphone unit share at 0.8%, down from 1.8% a year earlier.
- Shares are near the day's highs following the announcement and BGC's upgrade.
Yesterday, 10:06 AM
- Citing cost cuts and a more favorable risk/reward, BGC's Colin Gillis has upgraded BlackBerry (NASDAQ:BBRY) to Buy ahead of Friday's FQ3 report, and hiked his target by $1.50 to $12.50.
- Gillis downgraded BlackBerry to Hold on Sep. 25, shortly before the company's FQ2 report. Shares had fallen 10% since.
- Two days ago: BlackBerry slides ahead of earnings; analysts cautious
Mon, Dec. 15, 2:43 PM
- Ahead of Friday morning's FQ3 report, BlackBerry (BBRY -2.9%) has dropped to its lowest levels since mid-October. With the company having only 1 buy rating among sell-side firms to go with 23 neutral ratings and 13 bearish ones (per Thomson/First Call), pre-earnings commentary has been fairly cautious.
- "We continue to see headaches for the services business," says Credit Suisse (Underperform). It thinks BlackBerry, which last month forecast its services revenue would drop 50% in FY16, will see services revenue drop 17% Q/Q in FQ3 to $350.7M due to subscriber losses, ARPU pressure from carrier renegotiations, and challenges in monetizing the EZ Pass (BES migration) licensing program in "a competitive MDM market environment."
- Raymond James (Market Perform) is encouraged by the fact BlackBerry had 5.1M EZ Pass licenses as of its November update (up from 3.4M as of Sep. 26), but adds this "does not mean much until we see actual paying conversions." It sees BlackBerry reaching cash flow breakeven in calendar Q4 2015.
- BMO (Market Perform) believes hardware revenue will miss consensus, as declining legacy hardware sales offset Passport growth. However, it thinks "quarterly results are less meaningful than signs of software monetization," which it doesn't expect to see "true indicators" of until the FQ4 report.
- Goldman (Neutral) is relatively positive: Though expecting a largely in-line FQ3, it sees FQ4 EPS beating expectations with the help of strong BlackBerry Classic (officially launches on Wednesday) sales, and thinks a short-squeeze is possible.
Mon, Dec. 8, 8:18 AM
- BlackBerry Limited (NASDAQ:BBRY), in partnership with healthcare information services firm NantHealth, will launch the NantOmics Cancer Genome Browser in early 2015. It will be preloaded on Passport devices and available to the professional community in early 2015.
- The browser will enable interactive reporting on genomics data for physicians and other treatment providers in the clinical setting. Clinicians will be able to view a patient's chromosome at an individual base pair level.
- Skeptics would argue that researchers would have a greater interest in the new feature than clinicians.
- The NantOmics Cancer Genome Browser will be demonstrated at next month's Consumer Electronics Show in Las Vegas.
Thu, Dec. 4, 2:20 PM
- BlackBerry (BBRY -3.5%) wouldn't be able to accept a buyout offer from a Chinese company due to opposition from Western governments, John Chen tells Bloomberg in an interview taped on July 23, and airing tonight.
- Chen: "One of our biggest [installed] bases is government in the so-called Five Eyes countries where governments share intelligence. I think there will be a lot of regulatory issues and concerns." He adds BlackBerry doesn't currently have any buyout offers on the table.
- Lenovo reportedly weighed a bid for BlackBerry when the company was on the block last year, and has occasionally popped up in M&A rumors since. Meanwhile, Chen has been exploring ways for BlackBerry to enter China with the help of a local partner.
- Shares are selling off today after rising 6.2% over the prior two trading days.
Mon, Nov. 24, 6:37 PM
- From Dec. 1 to Feb. 13, BlackBerry (NASDAQ:BBRY) will provide iPhone users looking to buy a Passport $90-$400 in trade-in value (depending on the model), plus an extra $150.
- As of Nov. 22, BlackBerry is also offering $100 off black Passport models for a limited time - that brings the U.S. unsubsidized price to $499. A $275 discount is provided for the Z30, and PayPal financing is given for U.S. purchases over $200.
- BlackBerry is looking to boost a hardware business that saw estimated phone sales to end-users fall by 59% Y/Y in the August quarter to 2.4M. The Passport launched on Sep. 24.
Wed, Nov. 19, 7:54 AM
- The market has swung too optimistic on BlackBerry (NASDAQ:BBRY), says analyst James Faucette, cutting the stock to Underweight with a $7 price target.
- "We believe that the market has largely valued the company based on the assumption that BlackBerry will generate an incremental $250M in software revenue and an incremental $100M in messaging revenue during FY16, consistent with the targets set out by CEO John Chen (from roughly $0 today)."
- "We estimate this implies that BBRY will not only successfully retain roughly its entire existing enterprise subscriber base—plus more—it will also convince that subscriber base to increase ~3x how much it is paying BBRY today.”
- Shares -4.7% premarket
Fri, Nov. 14, 9:40 AM
- During an investor day (transcript) held yesterday afternoon following its enterprise announcements, BlackBerry (BBRY -0.2%) guided for FY16 (ends Feb. '16) services revenue of $800M, down 50% from an expected FY15 level of $1.6B. The company's total FY16 revenue consensus is currently at $3.78B (nearly flat Y/Y),
- As it is, services revenue has been dropping due to consumer fee cuts, hardware installed based declines, and enterprise promotions. Services was 46% of August quarter revenue, down from 54% a year earlier; BlackBerry's total revenue fell 42% during this time.
- BlackBerry is counting on hardware stabilization and software growth to help offset the services decline; software revenue is expected to double in FY16 to $500M. Long-term, it hopes newer enterprise services (such as those announced yesterday) and Project Ion will boost services revenue.
- Raymond James' Steven Li (Market Perform) notes the FY16 services guidance was below the firm's estimate of $1.14B, and "reduces the margin for error on BBRY’s target of doubling software revenues next year to offset the [services] decline and maintain cash flow breakeven." He also thinks an FQ3 revenue consensus of $965M remains too high; RJ forecasts $899M.
- On the other hand, Li declares the Samsung deal bolsters BES12's credibility as a cross-platform enterprise mobility management (EMM) solution. He's also pleased with John Chen's disclosure than a Fortune 10 client plans to use BES12 to manage non-BlackBerry devices; "almost all" of BlackBerry's initial 100+ BES12 deployments are believed to be for managing BlackBerrys.
- Shares are near breakeven in early trading. They rose 7% yesterday.
- Update (2:35PM ET): Shares are now down 6.4%.
Thu, Nov. 13, 1:37 PM
- As expected, BlackBerry (BBRY) has launched BES12 at a San Francisco launch event. The latest version of BlackBerry's mobile device/app management platform supports up to 25K devices/server and 150K devices/domain, adds support for embedded (non-mobile) devices, and features a revamped endpoint management model said to enable "more flexible management of devices, applications and data."
- BlackBerry is selling BES12 through a new subscription pricing structure (ranges from $23-$90/device/year), and is providing free upgrades through its EZ Pass migration program.The product squares off against MDM offerings from MobileIron, VMware's AirWatch unit, Good Technology, Microsoft, SAP, and Citrix, among others. MobileIron (MOBL -0.3%) CEO Bob Tinker recently claimed the enterprise market had become a 2-horse race between his firm and AirWatch.
- Meanwhile, BlackBerry has announced it's partnering with Samsung to create an end-to-end security offering for Samsung's Android hardware; it features BES12 and Samsung's KNOX enterprise security platform. As part of the deal, Samsung will begin reselling BES12 in early 2015.
- In addition, a partnership has been formed with Salesforce to create public sector offerings that pair BES12 with Salesforce's cloud CRM apps, and a BES12 distribution deal reached with leading mobile hardware distributor Brightstar.
- Other product launches: 1) New enterprise identity management and VPN authentication services that complement BES12. 2) BBM Meetings, a collaboration app that enables voice/video conferences on BB10, Android, and Windows devices. 3) BlackBerry Blend, a solution that allows BlackBerry phones to access data stored on a user's PC or tablet.
Mon, Nov. 10, 8:40 AM
- John Chen (NASDAQ:BBRY) says he talked with Lenovo CEO Yang Yuanqing and Xiaomi CEO Lei Jun, as well as HTC chairwoman Cher Wang, during a Beijing summit.
- No word on what Chen discussed, though he does say BlackBerry is looking for a partner as it tries to enter China. "It does seem that a more efficient way is to have a good partner to be here ... It’s a huge market but it’s a very highly competitive market too ... What I’m doing is to explore what is the right approach to the market given what we do well and I’m not shutting any doors."
- Chen previously said BlackBerry "needs to and should be" in China, but added he doesn't yet have a strategy for entering the market, and was hoping to get ideas at the summit.
- Also: Chen says BlackBerry will release one completely new phone in 2015, along with refreshes for its Passport, Classic, and Z3 phones, and will limit the scope of its hardware lineup. "I'm not going to build a general-purpose device, simply because it is a 5-inch touchscreen. The Chinese can build one for 75 bucks, I can't get enough parts together for 75 bucks."
Fri, Oct. 31, 5:57 PM
- BBM has been updated to include several new features: Among them: Support for messages/pictures that automatically erase following a specified amount of time (echoes of Snapchat); the ability to retract messages from a chat; HD photo transfers; and a new music discovery feature.
- BlackBerry (NASDAQ:BBRY) says timed messages and message retractions - two features that could appeal to privacy-sensitive business users - will be available for free for the next 3 months, but will afterwards be "offered as part of a BBM subscription."
- BlackBerry has previously announced plans to monetize BBM via mobile ads/sponsored content, virtual goods, and payments. BBM monthly active users (MAUs) totaled 91M at the end of August, up from ~60M at the time Android/iOS apps were released a year ago. Rivals include WhatsApp (600M+ MAUs), Line, Viber, WeChat, and Facebook Messenger.
Mon, Oct. 20, 11:16 AM
- "A source familiar with the matter" tells Benzinga Lenovo (OTCPK:LNVGY) could make an offer to acquire BlackBerry (NASDAQ:BBRY) as soon as this week.
- Before BlackBerry named John Chen CEO and stopped looking for a buyer last November, Lenovo was reported to be weighing a bid for all or parts of the company. The Canadian government responded by saying it would scrutinize the national security impact of any offer. Since then, Lenovo has agreed to pay $2.91B to acquire Motorola Mobility from Google.
- Short-covering could be driving today's gains: 19% of BlackBerry's float was shorted as of Sep. 30.
Fri, Oct. 17, 4:05 PM
- John Chen, discussing widespread reports of BlackBerry Passport (BBRY +2.1%) shortages: "I’m glad to have inventory issues. It shows that people want the phone ... We took a very conservative approach and didn’t order too many."
- Chen previously disclosed 200K Passports had been sold in the two days after the phone, replete with a physical keyboard and 4.5" square display, officially launched. AT&T, which has a U.S. exclusive, hasn't begun selling the Passport on its site.
- Separately, Chen declared BlackBerry "needs to and should be" in China, but added he doesn't yet have a strategy for entering the Middle Kingdom. He hopes to get some ideas while attending Beijing conference next month.
- The BlackBerry CEO also reiterates his company is focused on users who need their phones to be productivity tools (he estimates it's 30% of the market), and isn't going after those who solely view them as entertainment devices. "That is not a space that we can afford to be in now. Being sexy and being a workhorse are two different things."
Fri, Sep. 26, 10:18 AM
- Down initially following its mixed FQ2 results, BlackBerry (NASDAQ:BBRY) has quickly reversed course.
- Possibly helping: John Chen has forecast BlackBerry's software revenue (aided by the upcoming BES 12 launch, and perhaps also QNX and Secusmart), will double in FY16 from an expected FY15 level of $250M. Software/other sales were 8% of revenue in FQ2.
- Chen also states BlackBerry has sold 200K Passport phones since the device's Wednesday launch. End-user phone sales were an estimated 2.4M during FQ2.
- RBC's Mark Sue (Market Perform) notes services revenue (-19% Q/Q to $421M) was below his $453M estimate, and thinks the number is "likely to sustain concerns about BlackBerry’s declining subscriber base." However, phone shipments of 2.1M were above RBC's 1.65M forecast.
- Cowen's Tim Arcuri (Market Perform) calls BlackBerry's 47.5% gross margin "solid," At the same time, he argues "investor concerns are increasingly likely to key on how/when new technology and growth initiatives can/will arrest the Service decline and deliver a revenue inflection beyond Hardware."
- FQ2 results, details.
Fri, Sep. 26, 9:30 AM
- BlackBerry's (NASDAQ:BBRY) R&D spend fell 22% Q/Q and 48% Y/Y to $186M in FQ2, and its sales, marketing, and admin spend fell 51% Q/Q and 63% Y/Y to $195M. That helped EPS beat estimates in spite of a revenue miss.
- Also helping: Though BlackBerry's revenue fell by $50M Q/Q and its mix shifted towards hardware (lower-margin) relative to services, adjusted gross margin only fell by 50 bps to 47.5%. Hardware GM was positive.
- Hardware was 46% of revenue, services 46%, and software/other 8%. That compares with a 39%/54%/7% split in FQ1.
- Revenue was recognized on 2.1M phone shipments (up from FQ1's 1.6M), and an estimated 2.4M phones were sold to end-users (down from FQ1's 2.6M). Shipments were at 3.7M a year ago, and end-user sales 5.9M.
- North American revenue -28% Y/Y to $297M; EMEA -44% to $368M; Latin America -43% to $111M; Asia-Pac -49% to $140M.
- BBM users rose by 6M Q/Q to 91M. They were at ~60M before Android/iOS apps arrived last year.
- BlackBerry still expects to achieve breakeven cash flow by the end of FY15 (ends Feb. '15).
- FQ2 results, PR
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