Is the Priv smartphone a hit? BlackBerry says it's too early to tell

WATERLOO, Ont. -- BlackBerry is getting a financial boost from its growing software division, but the smartphone company says it's still to early to deem its latest Priv phone either a sales success or a disappointment.

See Full Article

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

"I don't want to over-hype that situation," chief executive John Chen told analysts Friday as BlackBerry delivered better-than-expected financial results.

He settled with saying Priv sales have been "quite positive."

Shares of BlackBerry jumped more than 10 per cent on Friday -- rising $1.14 to $12.03 on the Toronto Stock Exchange -- as investors responded favourably to the company's latest quarterly results.

Overall revenue came in above expectations and losses were far less than analysts had anticipated.

The international reception of the Priv will be closely watched in the coming weeks as BlackBerry prepares to launch it on a global scale.

After being available in only four countries during the third quarter ended Nov. 28, the phone's distribution will spike to 31 countries by the end of February when the company's fourth quarter ends.

BlackBerry is in the midst of a transition period where its software business has taken priority over designing phones. Sales of the Priv are considered an important metric in determining whether there's any hope in making future hardware.

Chen expects the handset division will become profitable again within the next two quarters, one of his key objectives since joining the company in late 2013, which suggests BlackBerry will stick with phones.

Even with the signs pointing to a future in hardware, Chen is reluctant to fully commit until he sees international sales figures.

"The next three months will tell us a lot," he said in a conversation with reporters at the company's headquarters in Waterloo, Ont.

The lack of Priv sales figures prevents investors from getting a clear picture of how many people bought the phone in its early days.

Chen said those numbers would be "misleading" because it took time to get the devices into stores.

However, BlackBerry did provide some insight through its usual tally of overall device sales, which include 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.

The Priv is also appealing to a different segment of the market than other recent BlackBerry phones, Chen said. In particular, the Priv is selling especially well with young professional women.

"I think it's more of a form factor situation," he said, noting that with its older Passport model "almost every customer is male."

In the third quarter, BlackBerry reported a net loss of 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.

Chen teased analysts with the possibility of new software for self-driving vehicles. He said more details will be revealed at the Consumer Electronics Show in Las Vegas next month.

BlackBerry's QNX division, headquartered in Ottawa, has spent years developing various automotive technology such as dashboard infotainment systems used by Ford Motor Co., General Motors, Hyundai and Volkswagen.



Advertisements

Latest Economic News

  • Why do you need a pet insurance, right here, right now

    Economic 24news
    Many Canadians would consider their pets as a part of their immediate, granular, family. Although some professionals think it’s not healthy, that’s the way life is in the twenty first century; There is a steep decline in the birth rate globally, with Japan leading the pack, and pets are filling in the void.
  • Tahoe Resources denies water contamination near its Peru gold mine

    Economic CTV News
    Vancouver-based Tahoe Resources Inc. says reports that heavy rains caused a leach pond at its Shahuindo gold mine in Peru to overflow and cause rainwater contamination are untrue. Tahoe says central Peru is experiencing exceptionally heavy rains, causing wide-spread flooding and mudslides throughout the region. Source
  • Lawsuit launched against obituary website alleges copyright infringement

    Economic CTV News
    ST. JOHN'S, N.L. - A lawyer in Newfoundland and Labrador is bringing a class-action suit against a website that collects obituaries and reposts them. The statement of claim, which has not been proven in court, alleges that the site managed by Afterlife Network Inc. Source
  • Amazon hikes monthly Prime membership price — but not in Canada

    Economic CBC News
    Amazon is hiking the monthly fee it charges its U.S. customers for Prime membership, but the change won't impact Canadians who all pay by the year. The online retailer announced Friday that starting immediately, new customers would be charged $12.99 US a month, up from $10.99 US previously. Source
  • CLC accuses Unifor of leaving lobby group to raid another union

    Economic CBC News
    The head of the Canadian Labour Congress is accusing Unifor of raiding another union for members after it severed ties with the national lobby group for the country's labour movement. Unite Here Local 75, which represents hundreds of hotel workers in Toronto and Mississauga, Ont. Source
  • SEC letter shows bitcoin funds won't happen soon, if ever

    Economic CTV News
    NEW YORK -- It may be a while, if ever, before investors can buy an exchange-traded fund made up of bitcoin and other digital currencies. Federal regulators have a long list of questions they want answered before they'll approve a digital currency fund for Main Street investors. Source
  • GM Canada president says NAFTA update needs to reflect changing technology

    Economic CTV News
    MARKHAM, Ont. - GM Canada president Steve Carlisle says it's important to update NAFTA to reflect changing technology since the original trade deal was signed. Carlisle says the automaker is cautiously optimistic about the trade talks as he prepared for the official opening of its new 700-employee software development centre north of Toronto. Source
  • Nova Scotia brewery offering a lobster beer, despite some skepticism

    Economic CTV News
    MAHONE BAY, N.S. -- A Nova Scotia craft brewery has put together two East Coast favourites to brew up something new: lobster-infused beer. Saltbox Brewery in Mahone Bay is now fermenting its first batch of Crustacean Elation -- a creation that involved the use of whole lobsters early in the brewing process. Source
  • Abortion rights advocate calls for more clarity on summer jobs program

    Economic CTV News
    OTTAWA -- An abortion rights advocate who urged the Liberals to deny summer job grants to groups opposed to letting women terminate their pregnancies says the government may have gone a step too far. Joyce Arthur of the Abortion Rights Coalition of Canada says she believes the government wanted to target organizations that would hire students to undermine reproductive rights, or discriminate against the LGBTQ community -- a goal she stands strongly behind. Source
  • CLC head accuses Unifor of leaving lobby group to raid another union

    Economic CTV News
    The head of the Canadian Labour Congress is accusing Unifor of raiding another union for members after it severed ties with the national lobby group for the country's labour movement. Unite Here Local 75, which represents hundreds of hotel workers in Toronto and Mississauga, Ont. Source