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- Well I thought I would go over my guestimates:
Cash on Hand - $ 3.1 Billion (Correct)
Core Program Still in Effect - (Correct)
Subs - 72MM down from 76MM = 4MM (2MM are from Venezuela so a drop of 2MM from other sources (Close - off by 500,000)
BB10 Phones 2.7 MM (Off by a Whopping 2.8 M phones - terrible)
BB07 Phones 4.1 MM (Off by a Whopping 600,000 phones - not good news, but saved some subs)
Revenues $ 3.1 B versus my $ 4.3 B - (2.8MM BB-10 phones X $ 485/phone in lost revenues missing this quarter)
EPS = $ .13/shr With $ .10/shr Venezuela, some minor issues and 2.8MM BB-10 x $ 140/phone did not materialize)
Sell-Through = ????? No numbers or percentages given here
Inventory Build = $ 300 (Correct)
From what I can see, the only factor that killed my forecast is the amount of BB-10 phones sold. All other points are met but the sales number for my model was way off. I have to concede that I felt Heins was promoting BB-10 in a big way and I listened too much to Misek and others who felt channel checks were firm. Having lost that potential amount of phone sales is very concerning indeed. I have to think that the balance of the year is needed to get this ship back on track now. They need the A10, a partnership and to get BES10 and BBM out there ASAP. The Web call was terrible, not for reasons as to what was said, but what wasn't stated. Even Misek had nothing to offer, he seemed deflated by the news.
Now for the stock, we won't post a chart at this time because charting works when both sides are ready to do battle. At this moment, shorts are selling, longs are selling and margin calls are coming so TA isn't going to deal with all of that nonsense for a few days. The support of the stock will now come from it core value which I think is around $ 12.00/shr.. So today we will trade at a discount to core value until the selling subsides. I do see the stock returning to $ 12.00/shr later on. For those of you who own the stock, I would suggest waiting for a bounce to the $ 12.00 mark and writing some Sept Calls against the position and get some premium while we wait. As many of you have suggested, the story is now going to play out much longer than planned. If we don't believe that handsets are the future for BlackBerry, we need to see contracts like the DoD to build a case for higher stock pricing here. With $ 6.00/shr in cash, it has been pointed out that everything else worth at least $ 6.00/shr which is very fair. The company also becomes a buy out candidate at these levels so there is the possibility of a partnership or complete buyout today. With such huge cash flow, the buyout could come from Prem for all I know, it is possible to see something happen in this light. Try to sit this out for a couple of days knowing that the analysts targets are coming down and the media will be all over this. The only number that I can see that sucked was the handset sales for BB-10.
That's my ramblings for now, I have to listen to that Webcast again to get more details out of it.06-28-13 09:21 AMLike 0 - Hey Morgan...
In reference to BB10 devices sold, what do you think about the fact that Q1 is traditionally a slow sales time for new phones?06-28-13 09:25 AMLike 0 - Barring any other news, I think we can pop back to $ 12.00/shr after today. The vast majority of the volume occurs in the first hour, we then see some buying come into the stock as the hard assets looks good down here. For all I know, there are those who are waiting to get into the trade precisely after something like this so we could see a strong snap back here. Watch the volume, we are already light on volume at the moment, compared to the first hour. Short covering will send it up briefly before they pull their bids so today isn't the best day to expect a big pop. Its coming, some good news like the DoD would help greatly here.06-28-13 09:27 AMLike 4
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If September doesn't impress or at least shine some light on BlackBerry's future, then I will be walking away.06-28-13 09:27 AMLike 3 - 2.7 million BB10 units shipped, that could be 1.7-1.95 million sell out. 560k-650k units per month. This was supposed to be the strong quarter because of the pent up demand.
It's not easy to sell BB10 to governments and companies with those numbers. Probably the smartphone market is over for BlackBerry, they have to concentrate on the services.06-28-13 09:28 AMLike 0 - We all just had it. And, as the video said, we never got kissed first.Charles Martin1 and bungaboy like this.06-28-13 09:28 AMLike 2
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- Oh I'm not saying it would have done well on the PB. I had the same thoughts as you regarding RAM. I'm just saying it's not going to be a very happy place. lol Not that we are but they have been quite angry there over the last few months and today they will be over the top.06-28-13 09:29 AMLike 2
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- The pent up demand was for Q10 which has not been for sale for a full quarter and also has not been released in all markets. Waiting for septer ER
2.7 million BB10 units shipped, that could be 1.7-1.95 million sell out. 560k-650k units per month. This was supposed to be the strong quarter because of the pent up demand.
It's not easy to sell BB10 to governments and companies with those numbers. Probably the smartphone market is over for BlackBerry, they have to concentrate on the services.06-28-13 09:30 AMLike 0 -
- Barring any other news, I think we can pop back to $ 12.00/shr after today. The vast majority of the volume occurs in the first hour, we then see some buying come into the stock as the hard assets looks good down here. For all I know, there are those who are waiting to get into the trade precisely after something like this so we could see a strong snap back here. Watch the volume, we are already light on volume at the moment, compared to the first hour. Short covering will send it up briefly before they pull their bids so today isn't the best day to expect a big pop. Its coming, some good news like the DoD would help greatly here.06-28-13 09:31 AMLike 0
- I was hoping for 5.5 MM and would have been very happy with 4.0 MM using that end of quarter 1 MM hardware contract as my guide. Didn't expect this at all. You could argue that not launching in more areas sooner, killed their chance of hitting street estimates but that doesn't help us now. Because of the 2.7 MM sales number, we are now a $ 12.00/shr company until they deliver on the software side. The Venezuelan loss of 2 MM subs didn't help either. So now they project $ 800 MM for Enterprise with single digit losses for Q2, not good either. The stock has bottomed out here but there is no lift at all for now. Thanks06-28-13 09:36 AMLike 6
- chalk it up to experience.
Never felt a 5 figure loss like this so quickly.
I'm still long at this point, pipe dream or not.06-28-13 09:38 AMLike 2 - I was hoping for 5.5 MM and would have been very happy with 4.0 MM using that end of quarter 1 MM hardware contract as my guide. Didn't expect this at all. You could argue that not launching in more areas sooner, killed their chance of hitting street estimates but that doesn't help us now. Because of the 2.7 MM sales number, we are now a $ 12.00/shr company until they deliver on the software side. The Venezuelan loss of 2 MM subs didn't help either. So now they project $ 800 MM for Enterprise with single digit losses for Q2, not good either. The stock has bottomed out here but there is no lift at all for now. Thanks
I think we should expect to see a lot more volatility to come back into the stock.06-28-13 09:39 AMLike 0 -
BlackBerry users are usually tied into a contract due to the higher value of the phone. If Q1 is not a time when people are buying phones, the summer buying season, the fall school season and the holiday buying season are the most likely times when contracts will start to expire and existing users can upgrade without penalty.morganplus8 likes this.06-28-13 09:40 AMLike 1 - And then we have this:
In BlackBerry’s fiscal 1st quarter, the company’s cash position grew from $2.9 billion at the end of the last quarter to $3.1 billion. That’s almost $6.00 per share. In fact, according to Capital IQ, BlackBerry’s pile of cash has never been bigger. This is not a typical characteristic of a company that is facing imminent death.
Contributing to the cash build was BlackBerry’s solid free cash generation in the quarter. With operating cash flow of $630 million and capital expenditures of just $83 million, $547 million of free cash was produced.
And this was not an anomaly. In last year’s first quarter $558 million of free cash was generated and in fiscal 2013, this metric totalled to almost $1.9 billion. Again, such prodigious free cash flow is not an indication of a company for whom the bell tolls.
Given BlackBerry’s market cap is currently about $5.6 billion (and falling by the second), this ability to produce about $2 billion/year in free cash gives it a free cash yield of an almost unheard of 35%.06-28-13 09:40 AMLike 5 - This quarter did not include Q10 sales, correct?
The Z10 was not available in many countries in this quarter, correct?morganplus8 likes this.06-28-13 09:41 AMLike 1 -
I think by end of next week we'll be sitting around $12.06-28-13 09:43 AMLike 9
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