The first full fiscal quarter of new BlackBerry handset sales is over and on Friday, the company reported 6.8 million handset shipments, up 13 percent from the prior quarter. A 15 percent boost in revenues over the last quarter amounted to $3.1 billion. But the company lost money — a contrast from the prior quarter — amounting to an operational loss of $84 million. And the new operating system isn’t resonating with consumers in terms of sales.
In a statement, CEO Thorsten Heins pitched the company’s efforts as just beginning:
“We are still in the early stages of this launch, but already, the BlackBerry 10 platform and BlackBerry Enterprise Service 10 are proving themselves to customers to be very secure, flexible and dynamic mobile computing solutions. “
It’s true that it’s early for BlackBerry’s overall strategy, but it’s later in the overall endgame of smartphone domination. And the new Z10 and Q10 phones don’t yet seem to be helping: The company says only 40 percent of the total phones shipped run BlackBerry 10, which is a key part of the transition from legacy to leading devices.
That works out to a scant 2.7 million BlackBerry 10 handsets shipped to carriers and retailers — not sold to consumers — in a single quarter. Let’s put that in perspective:
- At least that many Google Android devices are activated in two days.
- Apple sold 5 million iPhone 5 handsets during the first weekend of availability.
- In the first quarter of this year, Nokia sold 5.6 million Lumias running Microsoft Windows Phone, which is twice as many BlackBerry 10 devices sold.
I agree it is early for BlackBerry yet, but I don’t think sales of the new BlackBerry 10 devices are meeting or exceeding expectations. For one thing, I really anticipated that the loyal BlackBerry fans would be more receptive to the new phones and software. This group should be the company’s bread and butter for sales. I’ll grant that the new devices aren’t yet available in every market, which could be part of the issue.
Regardless, I expected more. So too did investors if the stock price is any indication: As of this writing, BlackBerry shares are trading down nearly 27 percent.
Even though the company has undergone cost-cutting measures since Heins took over, it doesn’t appear that greater sales will help boost profits in the near future: BlackBerry is now providing guidance for a loss in the next quarter as it will continue to push BlackBerry 10 and its enterprise services in more markets.