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BBRY: Why AT&T Delay May Be Good News

|Includes: BlackBerry Ltd. (BB)

Although US Q10 Launch is underway, only T-Mobile has confirmed they will be able to get stock to their stores this week. Verizon along with AT&T are saying that they are currently unsure when they will be able to start shipping devices to stores.

The initial response by the market appeared to have been negative as BBRY was down upon release of the news. That said, what is ironic here is that this could actually be extremely positive news with regards to how well the Q10 is doing in the US market. Consider the following:

  • T-Mobile rather than taking preorders on-line choose instead to simultaneously launch both on-line and retail later this week once stock from BBRY has been distributed to stores.
  • AT&T and Verizon both choose to accept pre-orders online.

Verizon indicated last week when they started accepting preorders that devices would be in stores this week. This change suggests they may have been overwhelmed by preorders and are working to fulfill that demand before shipping to retail.

In the case of AT&T, who are currently shipping devices to their corporate clients, the refusal to even discuss a retail launch date further supports the possibility that BBRY may be having trouble meeting demand.

This indicator strongly contradicts claims last week by Pacific Crest Securities' James Faucette suggesting that although BBRY is manufacturing in excess of 2m BB10 devices per month, BBRY is building too much product to sell and will have to write down the excessive inventory in the future at a significant loss.