Friday, 28 June 2013

Blackberry. Big loss means even tougher times as shares tank. This is now about survival.

Blackberry (or Crackberry as it was known), I've been keeping an eye on and blogged about before. 

In July 2012 I thought they were in a death spiral then and this might give you background - 

The appointment of Alicia Keys as Global Creative Director was, well, a WTF moment -

The smartphone and playbook maker has been struggling for some time.... although poor results have been balanced with an optimism that things well get better.

Well they haven't. 

Today the share is tanking -25% on foot of results from the last quarter and optimism has waned - to say the least. Thorsten Heins the CEO isn't exactly Steve Jobs and I'm not sure anyway, that he's inspiring. Poor English under an accent is never good in the old communication stakes and a more polished spokesperson might have been a better idea.

They lost 84m dollars in Q1 and predicted more losses in Q2 expected. They have also scrapped plans to update their Playbook, an indication that they've given up the ghost on that too. And subscriber numbers were not disclosed either (although rumour has it, they're down by 4 million).

Although it has to be said, their Revenue was up +15% and their accumulated cash improved.

Blackberry have put their future on their BB10/Z10 smartphone which was late to the market and these results are the first full quarter where the device has been available. 

They shipped (which is different to "sold") 6.8m smartphones in the quarter which compares with Apple's 37million nevermind Samsung's 60 million-ish.

The critical issue here is that these results have disappointed in that they show no sign of a hoped-for turnaround. 

Blackberry was once a dominant brand in smartphones and simply it has been overtaken by innovation of the Iphone and Samsung and others. Leadership of the company was focused on cost-cutting rather than building better brands and are now paying a price.

With market chatter today negatively and the corresponding collapse in share price, will make this a really difficult period for them. Really difficult. Early share price rallies have been wiped out and more at issue has been the wipe-out of confidence.

Survival is now the watchword for the once great brand.