Don’t let the optimists fool you, Blackberry’s earnings miss this morning is a big deal, says one analyst.
Anil Doralda, analyst with William Blair and Company, was on BNN’s “Headline” with host Howard Green this morning to talk about Blackberry’s disappointing Q1, 2014 earnings.
Doralda says he, like many others who had been negative on BlackBerry in past years, were actually feeling encouraged by the company’s progress of late, and expected the company might actually surprise to the upside. Instead, the Waterloo smartphone maker missed badly. For its Q1, 2014, which covers the three months ended June 1st, BlackBerry lost $84-million, or 16 cents a share on revenue of $3.1-billion.
Just 40% of BlackBerry devices shipped in the quarter were BlackBerry 10 models.
The street was expecting BlackBerry would earn four cents a share on revenue of $3.35-billion, and shares had rallied for most of the week in anticipation of better numbers.
Doralda says BlackBerry faithful will point to the fact that this quarter only included one month of sales in the United States, but analysts like him had been expecting much more from pent up demand and simple inventory refill. He says BlackBerry’s modest revival is now at a full halt, and this quarter marks the “beginning of the end” for the company.
Doralda says his channel checks suggest that the BlackBerry Z10 was not received well, and that the Q10 was “a little better” than that. He says the BYOD movement is also now shifting business away from the company, with workers toting their Android and iOS devices to work.
The William Blair analyst says those who think BlackBerry might return to its glory days are dreaming and that the company’s best hope now is to be a niche enterprise player with perhaps 2-3% of the overall market.