On Friday, BlackBerry will report its fourth quarter and fiscal 2015 results.
Tse expects the fourth quarter will be soft. He thinks the company will lose $0.07 a share on revenue of $763-million, well below the street consensus of a $0.04 loss on a topline of $797-million (all figures in U.S. dollars). The analyst says the decline will be driven by a fall in service revenue. He notes that the BlackBerry Classic was launched late in quarter, and as such will provide little help.
The Cormark analyst says despite his take on he is still “holding out hope” for BlackBerry. He says no clear leader has emerged in the Mobile device management/Enterprise mobility management space (MDM/EMM), with companies like MobileIron, AirWatch, and Good Technologies all weighing in at a less than 25% market share. Tse thinks the opportunity for BlackBerry in this space is real, and notes that research firm Radicati thinks it will grow to $5.75-billion by 2018.
Another catalyst Tse thinks is not off the table is the possibility of a takeover.
“We still believe it’s a target,” said Tse. “Despite the on-and-off acquisition talk for BlackBerry, we continue to believe this remains a credible thesis. Why? It goes beyond just the MDM/EMM opportunity. We continue to see meaningful potential with BlackBerry’s IoT opportunity via QNX which is present in over 50 MM vehicles with arguably the greatest coverage in that market with a potential to upsell new services on that mobile operating system”.
In a research update to clients this morning, Tse maintained his “Buy (Speculative)” rating on BlackBerry, but lowered his one year price target on the stock from $17.00 to $14.00.