BlackBerry Misses In Q1 2014: EPS Of -$0.13 On Revenue Of $3.1B, 6.8 Million Phones Shipped
BlackBerry has just released its fiscal Q1 2014 earnings today (yes, their fiscal calendar is a little kooky), and the company still can’t seem to find its footing. The company reported generating $3.1 billion in revenue this past quarter, up 9% year-over-year, but definitely missed most analyst estimates with an adjusted net loss of $67 million (which works out to -$0.13 per share).
Meanwhile, the consensus estimates according to Bloomberg Businessweek were for the company to report earnings of $0.07 per share on revenue of $3.4 billion. As you might expect, BlackBerry’s poor quarterly performance has left the company’s stock price tumbling in pre-market trading: at time of writing, the price is down over 18%.
UPDATE: And the stock price just keeps dipping. With just a few minutes until the market opens, it’s down nearly 24%.
Now these are undeniably bad numbers, but beyond that, today’s earnings release is a little… odd.
Take hardware for instance. More than a few pundits and analysts ruminated on the importance of the BlackBerry Q10 to the company over the past few weeks — it’s the first BlackBerry 10 device to sport the now traditional physical QWERTY keyboard, but today’s release doesn’t take into account U.S. shipments. Curiously enough though, BlackBerry didn’t break down its hardware shipments by OS like it usually does — according to the release the company shipped 6.8 million smartphones, but there’s no word on how many of them run BB10. Last quarter the company reported moving 1 million BB10 devices, so there’s something very strange (and frankly not very confidence-inspiring) about the fact that BB10 hardware doesn’t seem to get a nod this time around.
UPDATE: BlackBerry representatives noted on the earnings call that some 40% of the smartphones it shipped this past quarter were BB10 devices — that shakes out to about 2.72 million BB10 units moved.
Furthermore, there’s no word on the company’s subscriber base. Last quarter the company reported that it some 76 million subscribers were still loyal to the BlackBerry platform (down from 79 million the quarter before that). Has the number finally dipped to the point where the company would rather not flaunt it despite launching a new operating system and hardware to go with it? It sure seems like it.
If anything though, these next few months will shine even more light on whether or not BlackBerry still has the chops to compete in the crowded smartphone space. We’ll have a clearer understanding of the Q10′s sales impact in the United States, and BlackBerry pulled back the curtain on the entry-level Q5 last month, a device that seems tailor-made to help the company maintain its relatively strong position in emerging markets. It’ll be some time before we get a feel for the impact the Q5 will have on BlackBerry’s bottom line though — CEO Thorsten Heins noted during the Q5′s unveiling that the device won’t be available until sometime this summer, and declined to delve into which markets would get the thing first.
Speaking of the summer, Heins also noted that the BlackBerry Messenger service would go live for Android and iOS sometime over the next few months. BBM has endeared itself to a considerable chunk of fans (the service boasts “over 60 million” users across the globe), but we’ll soon see if it’s enough to keep BlackBerry competitive amidst a sea of messaging apps.
As always, the company will be holding an earnings call in just a little bit. Stay tuned — hopefully Heins explains where all those juicy numbers went.