Will Priv Save BlackBerry Q3 2016 Earnings?

  • BlackBerry Q3 2016 earnings are scheduled for release on December 18.
  • The BlackBerry stock is down 28% in the Year-to-date, with a weak performance in both topline as well as earnings.
  • The future of BlackBerry could hinge on the success of BlackBerry Priv, its recently launched Android smartphone.

BlackBerry (NASDAQ:BBRY) Q3 2016 earnings are scheduled for release on December 18, before markets open. BlackBerry stock has been battered on the bourses with the stock price down about 30% in the year-to-date. The stock has significantly underperformed the Nasdaq Composite (INDEX:COMPX) as well as S&P 500 (INDEX:SPAL).

BBRY stock chart

Source: BlackBerry stock price data by amigobulls.com

BlackBerry Earnings Stabilize

BlackBerry earnings over the last 8 quarters have been volatile ranging from a loss of 67 cents per share to a profit of 4 cents per share. John Chen has been trying to stabilize the earnings, which is seen from the fact that the earnings have stabilized between a loss of 20 cents to just over break even in the last few quarters. The street expects the company to report a loss of 15 cents per share, which again falls in the recent earnings range of the company.

BlackBerry Earnings

Source: estimize.com

Investors Worried By BlackBerry Revenue Decline

BlackBerry revenues have continued to decline over the last few quarters, missing the analyst consensus estimates for the past 5 quarters. BlackBerry's topline has now been in a state for decline for over 8 quarters, which is a big concern for investors. The street consensus is for BlackBerry to report revenue of $485 million, which will again be a significant YoY decline from $793 million in Q3 2015.

With BlackBerry fundamentals in a poor shape, the chances of a turnaround for BlackBerry stock look really slim at the moment. However, the company has been taking various steps to turn the corner. The latest such move was the launch of BlackBerry Priv.

Can BlackBerry Priv Revive BlackBerry?

The BlackBerry Priv has come in for praise from analysts. However, the important question will be whether or not the phone can sell in numbers large enough to make a substantial impact on BlackBerry financials. The Priv is BlackBerry's first dive into Android, and probably its last shot at survival. While the Priv has a lot going for it, in terms of compelling reviews and strong sales, the latest BlackBerry is targeted at the enterprise. With a $799 price for the unlocked device, BlackBerry needs to sell 1.5 million units to break even on this one.

The Priv could certainly be a big step in the revival of BlackBerry. However, Is it too little too late for the Canadian giant? It does not look like the Priv will propel BlackBerry to an earnings beat, but will definitely burn through the BlackBerry cashpile.

The current BlakBerry Product does not inspire confidence as none of the current phones are very compelling and while BBM has been doing good, it hasn't been able to compete with other messengers like Facebook messenger, WhatsApp and their likes.


With no clear advantage on either the hardware or software side, Investors should opt for other tech names like Apple (NASDAQ:AAPL) or Alphabet Inc-A (NASDAQ:GOOGL) to Blackberry stock. Moreover, with the current bring your own device (BYOD) trend which is emerging, BlackBerry could be clutching at thin air with enterprise oriented smartphone offerings. This could be a serious concern for BlackBerry and its investors. In conclusion, given the absence of a clear hardware or software advantage, the BlackBerry Q3 2016 earnings could well be hinged on the success of the Priv.

Amigobulls Amigobulls   on Amigobulls :

Neither Amigobulls, nor any members of its staff hold positions in any of the stocks discussed in this post. The author may not be a certified/registered investment advisor, and the opinions expressed should not be treated as investment advice.

Buying and selling of securities carries the risk of monetary losses.Readers/Viewers are advised to carry out their own due diligence and consult their investment advisors before making any investment decisions.

Neither Amigobulls, nor the author have any business relationship with any of the companies covered in this post.

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