BlackBerry downplays Priv sales as its third-quarter results beat expectations

WATERLOO, Ont. -- If BlackBerry's latest Priv smartphones are flying off shelves, the company isn't boasting about it.

With about a month of sales for the new device under its belt, BlackBerry was vague Friday about how its first Android smartphone has performed so far in the marketplace.

See Full Article

"Numbers will tell us but the initial 30 days, so to speak, has been quite positive, and I don't want to over hype that situation," chief executive John Chen told analysts Friday as BlackBerry delivered better-than-expected financial results.

Chen decided not to provide specific Priv sales figures, emphasizing that its availability will spike to 31 countries by the end of February when the company's fourth-quarter ends, from the initial four countries in the third quarter ended Nov. 28.

The lack of detail prevents investors from getting a clear picture of how many people bought the phone shortly after its launch. However, BlackBerry did provide some information by releasing its usual tally for all device sales, including the Passport and other older models that use the company's own operating system.

About 700,000 devices were sold, which is a steep decline from 1.9 million at the same time last year and also down from 800,000 in the second quarter of this year. But the average sales price jumped to $315 from $240, suggesting a large quantity of sales came from more expensive Priv phones.

BlackBerry (TSX:BB) (Nasdaq:BBRY) shares were nearly nine per cent higher in early Friday trading on the TSX as investors digested the latest financial report, which showed revenue came in above expectations and its loss was far less than anticipated.

The company's net loss was US$89 million or 17 cents per share under standard accounting rules.

After adjustments, BlackBerry lost US$15 million or three cents per share -- far less than analyst expectations of a loss of 14 cents per share, according to Thomson Reuters.

Revenue was US$557 million, a slight improvement from $548 million a year ago and about $64 million more than analyst predictions.

Within its divisions, the shift away from an emphasis on phone sales continued.

Software and services revenue more than doubled to $154 million from $57 million a year ago, driven by the recent acquisition of Good Technology Corp.

Hardware revenues, which account for device sales, dropped to $214 million from $361 million a year ago.

BlackBerry has been relying on the Priv as the golden ticket to make its hardware business profitable again.

"Depending on how Priv does ... there is a chance we could achieve or get closer to breakeven operating profitability for our overall device business in the (fourth) quarter," Chen said.

He also told analysts he expects the company's fourth-quarter results to outdo their current expectations, which predict an adjusted loss of 11 cents per share.

BlackBerry, a pioneer of smartphone industry and the former market leader, lost that position years ago as competitors like Apple's iPhone and Samsung's Galaxy attracted the majority of its longtime users.

The Priv is BlackBerry's most aggressive attempt to bring some of those customers back. Reviews for the device have been mixed to positive and the company has been criticized for pricing the phone well above other Android devices on the market.

When BlackBerry's competitors introduce new devices next year the company will likely have to reduce the price of the Priv to be competitive, Chen said.

"We obviously won't fool ourselves to expect we'll continue to maintain the high prices that we could get today," he said.

In early trading, BlackBerry shares were ahead 98 cents to C$11.87 on the Toronto Stock Exchange.


Latest Economic News

  • Canadian malls need to diversify to become destinations for shoppers, say experts

    Economic CTV News
    MONTREAL -- The rise of online shopping is forcing Canadian malls to diversify and become destinations that offer a range of services including entertainment and sporting venues in addition to traditional clothing stores, a Montreal real estate conference heard Tuesday. Source
  • Quebec says it's on track for $2.2-billion surplus in current fiscal year

    Economic CTV News
    Quebec is projecting a higher than expected surplus of $2.2 billion in the current fiscal year and is also abolishing a health tax two years ahead of schedule. Information available over the summer led the government to call for a surplus of $1.8 billion for fiscal 2016-17, which ends next March 31, but Finance Minister Carlos Leitao said Tuesday that provincial revenues have increased more than expected. Source
  • Pipeline company asks protesters to leave North Dakota land

    Economic CTV News
    CANNON BALL, N.D. - The developer of the Dakota Access oil pipeline said Tuesday that the dozens of protesters who have camped on company-owned land since the weekend are trespassing and that "lawless behaviour will not be tolerated. Source
  • Red ink will rule, but optimism in the oilpatch as earnings released

    Economic CBC News
    Precision Drilling announced some full-on good news last week with its third-quarter earnings. Although the company lost $47 million in the third quarter and revenue was down by nearly a half, it also said that it had rehired 1,000 workers. Source
  • CN Rail slightly raises outlook for 2016 despite dip in Q3 profits, revenues

    Economic CTV News
    MONTREAL -- Canadian National Railway Co. boosted its earnings forecast for 2016 despite seeing its profits and revenues decline in the third quarter. The Montreal-based railway raised it outlook for the year, saying it expects adjusted earnings will increase by about one per cent above the $4.44 per share earned last year. Source
  • CN Rail recalls workers to prepare for the smooth handling of bumper grain crop

    Economic CTV News
    MONTREAL -- Canadian National Railway Co. says it has recalled laid-off employees to handle the start of what is expected to be bumper grain crops in Canada and the United States. "We're handling and ready to handle more of the crop that has been produced," chief operating officer Mike Cory said Tuesday after the Montreal-based carrier reported third-quarter results. Source
  • Former Expos owner, Seagram's titan Charles Bronfman reflects on life as a 'late bloomer'

    Economic CTV News
    He steered Seagram's Co. Ltd. to great success and brought the Montreal Expos to Canada, but Canadian billionaire Charles Bronfman insists he was a "late bloomer," after years of struggling with low self-esteem in his early life. Source
  • iPhone 7 sales, holiday outlook in focus as Apple reports after the bell Tuesday

    Economic CBC News
    Apple Inc. will report fourth-quarter and full-year earnings after the close of trading Tuesday, with analysts expecting the tech giant to report a third straight quarterly revenue drop and its first drop in annual revenue in 15 years. Source
  • Apple iPhone sales drop for 3rd-straight quarter, but still top expectations

    Economic CBC News
    Apple Inc. will report fourth-quarter and full-year earnings after the close of trading Tuesday, with analysts expecting the tech giant to report a third straight quarterly revenue drop and its first drop in annual revenue in 15 years. Source
  • Trilogy estimates pipeline spill at 250,000 litres of oil and water

    Economic CTV News
    CALGARY - Trilogy Energy Corp. estimates a leak from its pipeline in west-central Alberta released 250,000 litres of oil and water before it was discovered in early October. The company announced the preliminary estimate Tuesday, the same day the Alberta Energy Regulator formally launched an investigation of the spill 16 kilometres northeast of Fox Creek, Alta. Source