Seeking Alpha

BlackBerry Ltd. (BBRY)

  • Yesterday, 2:27 PM
    • BlackBerry (NASDAQ:BBRY) states it's working with Google to allows BES12 to manage hardware supporting Google's Android for Work platform, which provides a slew of security, device/app management, and file-sharing tools for enterprises deploying Android phones/tablets.
    • BES12 will allow Android to support app containerization (places corporate apps/data in a protected sandbox), while also enabling "unhindered access" to Now, Play, and other Google services (provided IT departments approve).
    • Fellow enterprise mobility management (EMM) software vendors MobileIron (MOBL +1.6%), VMware/AirWatch, and Citrix have also announced their support for Android for Work (I, II, III). The deal follows BlackBerry's November partnership with Samsung to create a security offering pairing BES12 with Samsung's KNOX enterprise Android security platform.
    • Shares have spiked higher following the Google announcement.
    • Earlier: BlackBerry Classic to hit Verizon tomorrow
  • Thu, Jan. 22, 9:15 AM
    | 1 Comment
  • Wed, Jan. 21, 7:29 PM
    • Though both companies have issued statements denying M&A talks, Samsung (OTC:SSNLF) is "actively pursuing a plan to take over or buy a significant stake in BlackBerry (NASDAQ:BBRY)," Canada's Financial Post reports.
    • The paper has obtained a document prepped for Samsung by i-bank Evercore that "outlines the case for, and the potential structure of a possible purchase of BlackBerry." Though the doc was created in Q4 2014, a source says Samsung remains interested. “I can tell you Samsung is contemplating a purchase. It’s still being pursued right now. Samsung is still evaluating their options."
    • BlackBerry soared a week ago after Reuters reported Samsung had proposed buying the company for a price between $13.35-$15.49/share. Shares quickly gave back most of their gains after BlackBerry denied having talked with Samsung about a buyout offer. Samsung later provided its own denial.
    • BlackBerry has jumped in AH trading to $10.65.
  • Thu, Jan. 15, 12:45 PM
    | Comment!
  • Thu, Jan. 15, 9:16 AM
  • Wed, Jan. 14, 5:38 PM
    • In response to Reuters' report, BlackBerry (NASDAQ:BBRY) says it "has not engaged in discussions with Samsung (OTC:SSNLF) with respect to any possible offer to purchase BlackBerry."
    • BBRY -11.2% AH. Shares are still up 15% from yesterday's close.
    • Update: The Globe and Mail reports BlackBerry has "shunned a handful of takeover overtures in recent months as its board of directors and largest investor continues to support a restructuring strategy that they expect will deliver greater shareholder value than current acquisition offers."
  • Wed, Jan. 14, 4:14 PM
    • Samsung (OTC:SSNLF) proposed acquiring BlackBerry (BBRY +29.8%) for a price between $13.35-$15.49/share, according to a Reuters source. BlackBerry closed yesterday at $9.71, and has closed today at $12.60. Shares are up another 3.2% AH to $13.02.
    • According to documents, Samsung's proposed acquisition range implies an enterprise value of $6B-$7.5B, after factoring $1.25B in convertible debt. Execs from both companies reportedly met last week.
    • Reuters states Samsung is interested in BlackBerry's patent portfolio. BlackBerry could also mesh with Samsung's efforts to grow its enterprise presence, strengthen its embedded/IoT offerings, and (though this is easier said than done) lower its Google dependence. The companies announced a BES12-focused enterprise partnership in November.
    • Previously: Samsung reportedly approached BlackBerry about acquisition
    • Update: BlackBerry denies having talked with Samsung about a buyout offer.
  • Wed, Jan. 14, 3:50 PM
    • Reuters reports Samsung (OTC:SSNLF) approached BlackBerry (NASDAQ:BBRY) about a potential acquisition.
    • BlackBerry has skyrocketed in response. With 118.6M shares (over 24% of the float) shorted as of Dec. 31, short-covering is likely playing a big role.
  • Tue, Jan. 13, 4:05 PM
    • Believing near-term Classic sales are lower than previously expected, Baird's William Power has cut his FQ4 (Feb. quarter) BlackBerry (NASDAQ:BBRY)  revenue and EPS estimates to $746.3M and -$0.03 from $937.3M and $0.00. Consensus is at $860.1M and -$0.03.
    • Power: "We had previously assumed greater Classic device contribution in fiscal Q4, though following conversations at CES, it appears that much of that revenue may not be recognized until fiscal Q1." He now expects just 1.6M FQ4 phone sales; BlackBerry recognized revenue on 2M phones in FQ3, and had end-user phone sales of 1.9M.
    • Meanwhile, Canaccord's Mike Walkley has lowered his FY15 BlackBerry sales and EPS estimates to $3.4B and -$0.21 from $3.45B and -$0.18. Regarding the Classic, he reports seeing  "pockets of solid sales offset by soft initial sales in the U.S. market."
    • Walkley does think FQ4 could "mark the low point for hardware sales." But he also expects BlackBerry "will continue to post operating losses through [FY16] given the steep decline in the higher margin Services business only partially offset by growing Software sales."
    • Shares fell 4.2% in regular trading to $9.70.
  • Dec. 22, 2014, 9:48 AM
    • "BlackBerry is effectively transitioning to a cross-platform software/services company. In this context, the device business should not be banked on to generate profit," says TD Securities, upgrading BlackBerry (NASDAQ:BBRY) to Buy after the company reported mixed FQ3 results, a 56% Y/Y drop in end-user phone sales, and a ~100% Q/Q increase in BES10 licenses.
    • TD sees BlackBerry shipping 8.9M phones in FY16 (ends Feb. '16) - less than the 10M the company has said it needs to turn a profit on hardware - at a 15% gross margin. ~75% of FY16 gross profit is expected to come from software and legacy services.
    • BlackBerry has forecast its software revenue will double in FY16, and that its services revenue will fall by 50%. Shares are now above where they traded prior to the FQ3 report.
    • Also: BlackBerry has disclosed it's partnering with Boeing to "provide a secure mobile solution for Android devices" that leverages BES12. The solution is tied to Boeing's ultra-secure Black phone (meant for U.S. defense/security clients).
    • BlackBerry earnings coverage
  • Dec. 19, 2014, 9:11 AM
  • Dec. 17, 2014, 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
  • Dec. 15, 2014, 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.
  • Dec. 4, 2014, 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.
  • Nov. 19, 2014, 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
  • Nov. 14, 2014, 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%.
Visit Seeking Alpha's
BBRY vs. ETF Alternatives
Company Description
BlackBerry Ltd is a designer, manufacturer and marketer of wireless solutions for the mobile communications market.