View Poll Results: Did you buy shares ?

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  • Yes, I'm acting now !

    693 62.66%
  • No

    413 37.34%
  1. sidhuk's Avatar
    make the long story short and cut the (rap. please short the stock and bring it in 9s. i wanna rinse and wash again.

    edit: forgot to add "The" before crap. it should read The Crap.
    01-08-15 02:07 PM
  2. Munx's Avatar
    Where did you get $60M from, was that not a wild speculation?
    The number of $50-60M comes from the company. This is the 15% service revenue loss that they will not be able to overcome with hardware sales in Q4. The company's exact statement regarding Q4 revenue challenges can be found in their EDGAR filing which should be mandatory reading for all investors. GL.

    Posted via CB10
    01-08-15 02:08 PM
  3. sidhuk's Avatar
    we should post this video on every page, or make it sticky. Amber is asking all the good questions. seems like she knew in advance of all the clever arguments that have been going on here for last few days. so if you are part of that debate then hear it from the guy who actually makes decisions and have been in the driving seat.
    http://www.bnn.ca/Video/player.aspx?vid=517197
    01-08-15 02:20 PM
  4. morganplus8's Avatar
    The number of $50-60M comes from the company. This is the 15% service revenue loss that they will not be able to overcome with hardware sales in Q4. The company's exact statement regarding Q4 revenue challenges can be found in their EDGAR filing which should be mandatory reading for all investors. GL.

    Posted via CB10
    I think you are being a little misleading there, they will fall short, to the amount - 15% - 17% on the previously reported quarterly services amount. But, .. they will off-set some of that with other revenues. It doesn't appear as though they will off-set all of that amount but to say they will have $ 50 - $ 60 MM in net loss of revenue is erroneous. All we know is that revenues will likely fall short of the prior recorded period but they are trying to off-set the full impact of the decrease in services with other revenues.
    ibpluto, jxnb, bbjdog and 10 others like this.
    01-08-15 02:23 PM
  5. Munx's Avatar
    I think you are being a little misleading there, they will fall short, to the amount - 15% - 17% on the previously reported quarterly services amount. But, .. they will off-set some of that with other revenues. It doesn't appear as though they will off-set all of that amount but to say they will have $ 50 - $ 60 MM in net loss of revenue is erroneous. All we know is that revenues will likely fall short of the prior recorded period but they are trying to off-set the full impact of the decrease in services with other revenues.
    We know that 'revenue will likely fall short of the prior recorded period but they are trying to off-set the full impact of the [$50-60M] decrease in services with other revenue.'

    We also know that the majority of Q3 Passport sales revenue will be recognized in Q4.

    We also know that software revenue stalled in Q3 while we wait for new revenue streams to ramp.

    These data points clearly outline the challenges Chen faces. And they also cool new device unit sales expectations.

    Posted via CB10
    01-08-15 02:37 PM
  6. plasmid_boy's Avatar
    The number of $50-60M comes from the company. This is the 15% service revenue loss that they will not be able to overcome with hardware sales in Q4. The company's exact statement regarding Q4 revenue challenges can be found in their EDGAR filing which should be mandatory reading for all investors. GL.

    Posted via CB10
    You are not making any sense, man.
    First you said that if there is $60M loss, then that means new phones are not selling well. But now you say that the $60M you quoted was part of the 15% projected decline of service revenue?
    Did I miss something?

    Posted via CB10
    01-08-15 02:39 PM
  7. sidhuk's Avatar
    I think you are being a little misleading there, they will fall short, to the amount - 15% - 17% on the previously reported quarterly services amount. But, .. they will off-set some of that with other revenues. It doesn't appear as though they will off-set all of that amount but to say they will have $ 50 - $ 60 MM in net loss of revenue is erroneous. All we know is that revenues will likely fall short of the prior recorded period but they are trying to off-set the full impact of the decrease in services with other revenues.
    $50mill/$500 (passport retail price) = 100.000 passports. chen said that most of the passport from initial order (200,000) were not included in the past quarter revenues. he only included when passport screen was lit up. LoL (what kind of accounting practice is that?)
    IMO, this guy and his team is way ahead of the public climax.
    01-08-15 02:41 PM
  8. bbjdog's Avatar
    John Chen has been at the helm for approximately one year, that's four quarters. The SAF fees start with Thorsten Heins era. He took a major blow on the SAF and then it's been four quarters for current CEO, due the math. Anything below zero doesn't count.

    Posted via CB10
    01-08-15 02:43 PM
  9. chrysaurora's Avatar
    $50mill/$500 (passport retail price) = 100.000 passports. chen said that most of the passport from initial order (200,000) were not included in the past quarter revenues. he only included when passport screen was lit up. LoL (what kind of accounting practice is that?)
    IMO, this guy and his team is way ahead of the public climax.
    ASP is definitely much lower than $500. It's $400 at best. So, at $400, it'd be 125,000 Passports. But I am inclined to lower it even a bit more to account for sales, commissions, customer returns etc and think 135,000 Passports for every $50 Million in revenue.

    Also, he didn't say most of the Passport from initial orders were not included; he said the follow-up orders (after the initial orders) - most of those follow-up (second batch of manufacturing) were not shipped in time to be included in the revenue. First 200k were definitely included.

    Revenue recognition - it's common accounting practice to recognize revenue after the device has been sold to end-customer. BlackBerry might have an agreement with retailers to accept unsold inventory back. So, that's probably why, unless device has been sold by channel to end-customer, BlackBerry does not recognize it's revenue. You can read official BlackBerry policy here: Investor FAQ - Canada (How does BlackBerry recognize revenue?)
    01-08-15 02:49 PM
  10. sidhuk's Avatar
    ASP is definitely much lower than $500. It's $400 at best. So, at $400, it'd be 125,000 Passports. But I am inclined to lower it even a bit more to account for sales, commissions, customer returns etc and think 135,000 Passports for every $50 Million in revenue.

    Also, he didn't say most of the Passport from initial orders were not included; he said the follow-up orders (after the initial orders) - most of those follow-up (second batch of manufacturing) were not shipped in time to be included in the revenue. First 200k were definitely included.

    Revenue recognition - it's common accounting practice to recognize revenue after the device has been sold to end-customer. BlackBerry might have an agreement with retailers to accept unsold inventory back. So, that's probably why, unless device has been sold by channel to end-customer, BlackBerry does not recognize it's revenue. You can read official BlackBerry policy here: Investor FAQ - Canada (How does BlackBerry recognize revenue?)
    the sale price is $599 in us and $699 in canada after $100 discount.
    BlackBerry Smartphones & Accessories ? Buy Unlocked Phones, Cases, Chargers, Batteries, Bluetooth Accessories & More
    bungaboy and chrysaurora like this.
    01-08-15 02:56 PM
  11. morganplus8's Avatar
    We know that 'revenue will likely fall short of the prior recorded period but they are trying to off-set the full impact of the [$50-60M] decrease in services with other revenue.'

    We also know that the majority of Q3 Passport sales revenue will be recognized in Q4.

    We also know that software revenue stalled in Q3 while we wait for new revenue streams to ramp.

    These data points clearly outline the challenges Chen faces. And they also cool new device unit sales expectations.

    Posted via CB10
    Aside from side stepping my point, you are contradicting yourself. Software gained 1% last quarter, handsets were blown out to the tune of a 93% reduction in inventory. Those BB 10 legacy phones aren't going to make up any of the revenue for Q4, so we'll be relying on BB Classics and Passports for all of our future revenue. Now before you say it, we don't know what SAP per Passport or Classic is, it is some formula of Foxconn agreements less distributors agreements and whatever else they have. Therefore it isn't possible for us to assign a value to the carry forward of Passports into Q4. With all of those variables in place, it is still safe to say that BlackBerry is trying to off-set losses in services and just might be able to beat John Chens own expectation that they won't sell enough of their new products to make up for legacy BB 10 phone unit sales reductions. You just can't make the claim that passport sales are weak. And you certainly can't claim that gross revenues for Q4 will be below Q3 as it is possible they will in fact be higher, the Q isn't over yet and those same products are still for sale.
    01-08-15 02:58 PM
  12. ibpluto's Avatar
    Let's not forget he also noted initial orders for the Classic was better than the PassPort, and I suspect there should be some of that recognized in Q4. Don't want to say he is sandbagging, but I think he has purposely trimmed from Q3 to offset in Q4 to have revenues fairly stable.

    My prediction is, revenues will actually be in the high $700 million, similar to Q3. I also think EPS will be 0.03-0.05$

    Chen is savvy, I would not bet against him. Especially with this week's comments to Fox saying BlackBerry is not going away.

    CB10'n it....via da Z30
    01-08-15 03:00 PM
  13. morganplus8's Avatar
    Hey Sidhuk !!

    I have been trying ti get my head around this SAP cost for sometime now! I think BB doesn't make more than 15% on the first 200,000 units as most of that revenue stays with Foxconn. After the fixed costs are met, I think there is a sliding scale used to give BB much more of the pie. It could be 25% of the next 200,000 or so. When you talk Apple, you of course get an average cost per unit because fixed costs are taken up in the first order. But poor little BB, with its' history, they are going to take little profit back from the risk factor allotted to Foxconn. Now Chen is likely to be pleased to see they surpassed that breakeven hurdle and are making good money on the follow-up units sold. I think you see high SAP, others see really low SAP and I'm on the fence seeing a scaled up version of SAP. Oh boy!!
    01-08-15 03:15 PM
  14. sidhuk's Avatar
    Hey Sidhuk !!

    I have been trying ti get my head around this SAP cost for sometime now! I think BB doesn't make more than 15% on the first 200,000 units as most of that revenue stays with Foxconn. After the fixed costs are met, I think there is a sliding scale used to give BB much more of the pie. It could be 25% of the next 200,000 or so. When you talk Apple, you of course get an average cost per unit because fixed costs are taken up in the first order. But poor little BB, with its' history, they are going to take little profit back from the risk factor allotted to Foxconn. Now Chen is likely to be pleased to see they surpassed that breakeven hurdle and are making good money on the follow-up units sold. I think you see high SAP, others see really low SAP and I'm on the fence seeing a scaled up version of SAP. Oh boy!!
    you are probably right. i just threw out the numbers based on pure retail reporting because i didnt feel the initial argument of $50-70 mill was a serious legitimate argument. i felt that you and doc were waisting your time. LoL it was my way of saying nicely that lets change the subject.

    IMO, i think Blackberry still takes home about 30% on passports. (foxcon doesn't build passports)
    01-08-15 03:29 PM
  15. Munx's Avatar
    Aside from side stepping my point, you are contradicting yourself. Software gained 1% last quarter, handsets were blown out to the tune of a 93% reduction in inventory. Those BB 10 legacy phones aren't going to make up any of the revenue for Q4, so we'll be relying on BB Classics and Passports for all of our future revenue. Now before you say it, we don't know what SAP per Passport or Classic is, it is some formula of Foxconn agreements less distributors agreements and whatever else they have. Therefore it isn't possible for us to assign a value to the carry forward of Passports into Q4. With all of those variables in place, it is still safe to say that BlackBerry is trying to off-set losses in services and just might be able to beat John Chens own expectation that they won't sell enough of their new products to make up for legacy BB 10 phone unit sales reductions. You just can't make the claim that passport sales are weak. And you certainly can't claim that gross revenues for Q4 will be below Q3 as it is possible they will in fact be higher, the Q isn't over yet and those same products are still for sale.
    Not attempting to side step or mislead anyone. Here is how I see things:

    Service revenue decline of $54M (company guidance).
    Q4 revenue challenged, and revenues expected to bottom sometime in coming quarters (paraphrased company statements see EDGAR filings).
    Majority of Q3 Passport sales to be recognized in future quarters (Chen statement).
    Large inventory cleaning in Q3 (Chen statement).
    Software revenue flat lined in Q3 (company filings).
    Software revenue not expected to ramp for two quarters (Chen statement).

    Based on the above, one can conclude the following:

    Q4 revenue will indeed be lower (conjecture based on company guidance).
    Old inventory cleared, so Q4 and forward HW ASP should actually increase (conjecture).

    Q4 revenue lower despite majority of high ASP Q3 Passport sales and some Classic sales being recognized in Q4. Ergo Passport sales are weak. (conjecture and logical conclusion).

    With software revenue being flat, the delta in top line revenue is simply the difference between service decline and hardware revenue variance (math).

    If revenue comes in below $720M, then we know hardware sales declined further in Q4 and I think this could have negative SP implications. Then again, if they are cash flow even the market may give us a pass (all opinion).
    sidhuk, rarsen, sati01 and 3 others like this.
    01-08-15 03:47 PM
  16. bbjdog's Avatar
    Let's keep in mind, that the passport was built in Mexico.

    Posted via CB10
    01-08-15 03:53 PM
  17. sidhuk's Avatar
    Not attempting to side step or mislead anyone. Here is how I see things:

    Service revenue decline of $54M (company guidance).
    Q4 revenue ‘challenged’, and revenues expected to bottom sometime in coming quarters (paraphrased company statements – see EDGAR filings).
    Majority of Q3 Passport sales to be recognized in future quarters (Chen statement).
    Large inventory cleaning in Q3 (Chen statement).
    Software revenue flat lined in Q3 (company filings).
    Software revenue not expected to ramp for two quarters (Chen statement).

    Based on the above, one can conclude the following:

    Q4 revenue will indeed be lower (conjecture based on company guidance).
    Old inventory cleared, so Q4 and forward HW ASP should actually increase (conjecture).

    Q4 revenue lower despite majority of high ASP Q3 Passport sales and some Classic sales being recognized in Q4. Ergo Passport sales are weak. (conjecture and logical conclusion).

    With software revenue being flat, the delta in top line revenue is simply the difference between service decline and hardware revenue variance (math).

    If revenue comes in below $720M, then we know hardware sales declined further in Q4 and I think this could have negative SP implications. Then again, if they are cash flow even the market may give us a pass
    (all opinion).
    Makes sense. you made some great point. Thank you. agree with you 100%
    bungaboy, rarsen, bbjdog and 4 others like this.
    01-08-15 03:53 PM
  18. bungaboy's Avatar
    We? I? One?

    The BBRY Café.  [Formerly: I support BBRY and I buy shares]-elmer-fudd-bears.jpg
    ibpluto, lcjr, 3MIKE and 6 others like this.
    01-08-15 03:56 PM
  19. spiller's Avatar
    Makes sense. you made some great point. Thank you. agree with you 100%
    Also agree with all of this. But Chen said he expects to be + EPS moving forward. So even if revs are lower still not a bad situation....

    BECAUSE, on the next CC, Chen will be able to say how many are now PAYING customers on BES12, maybe how many are silver vs gold, perpetual or not perpetual -- he can debunk that everyone was simply holding the option on EZ Pass since they were free trial licences but still with competitors and not using BES in production. With this, he will be able to guide Q1/16 ...

    So Q4 conference call IMO will be more about the Q1/16 BES customers/licences guidance and forward revenue guidance ("we have hit bottom on revenue, revs expected to be higher moving forward, we are + EPS and will ramp up higher moving forward) [as EZ Pass is done and BES revenues are flowing in....] If hardware is really bad i.e. 1M sales, but still positive, he will maintain his line that he will keep selling hardware if it is profitable, which it should be, and call it niche for enterprise customers. It takes governments forever to get their POs firmed, so hopefully they order bundles of the Classic over the next two Qs after moving to BES12 production.

    So this is a counter argument to shorts being able to push the SP lower because of lower revs....they will likely try like they did on the Q3 call ($9.10 low back to $10 recovery by closing bell) and fail again. Or they might just rush for the exits in pre market to cover before big funds can force their hand....
    Munx, bbjdog, Mr BBRY and 2 others like this.
    01-08-15 04:05 PM
  20. BanffMoose's Avatar
    I think BB doesn't make more than 15% on the first 200,000 units as most of that revenue stays with Foxconn.
    Are you sure Foxconn is involved? I thought Foxconn was only for low end devices, and BlackBerry was still using their historic manufacturing partners for the mid- and upper-end devices such as the Passport and Classic. I guess those of you with Passports and Classics should be able to see if they were manufactured in Canada/Mexico or China.
    01-08-15 04:05 PM
  21. spiller's Avatar
    Are you sure Foxconn is involved? I thought Foxconn was only for low end devices, and BlackBerry was still using their historic manufacturing partners for the mid- and upper-end devices such as the Passport and Classic. I guess those of you with Passports and Classics should be able to see if they were manufactured in Canada/Mexico or China.
    Chen confirmed on Q3 CC that Classic is Foxconn...
    morganplus8, BanffMoose and q649 like this.
    01-08-15 04:08 PM
  22. sati01's Avatar
    Hey Sidhuk !!

    I have been trying ti get my head around this SAP cost for sometime now! I think BB doesn't make more than 15% on the first 200,000 units as most of that revenue stays with Foxconn. After the fixed costs are met, I think there is a sliding scale used to give BB much more of the pie. It could be 25% of the next 200,000 or so. When you talk Apple, you of course get an average cost per unit because fixed costs are taken up in the first order. But poor little BB, with its' history, they are going to take little profit back from the risk factor allotted to Foxconn. Now Chen is likely to be pleased to see they surpassed that breakeven hurdle and are making good money on the follow-up units sold. I think you see high SAP, others see really low SAP and I'm on the fence seeing a scaled up version of SAP. Oh boy!!
    I think Passport is not part of the Foxconn deal.
    bbjdog likes this.
    01-08-15 04:11 PM
  23. morganplus8's Avatar
    [QUOTE=Munx;11240735]

    Hey Munx !!!

    Q4 revenue lower despite majority of high ASP Q3 Passport sales and some Classic sales being recognized in Q4. Ergo Passport sales are weak. (conjecture and logical conclusion).
    Not so, you have to look at Q3 revenue of $ 793 MM not anything less when you talk about weaker Passport sales. Hardware is one of the main components to stave off lower revenues in Q4. But an increase in hardware sells to the tune of $ 50 MM still results in a weaker Q4 revenue report. And so hardware sales of just passports and classics could come in extremely high compared to passport sales alone. What we don't know is how much BB is receiving on those initial passports so we can't calculate what their margins are inside that 200,000 first order. The debate here is by how much will revenues in Q4 be less than $ 793 MM.


    If revenue comes in below $720M, then we know hardware sales declined further in Q4 and I think this could have negative SP implications. Then again, if they are cash flow even the market may give us a pass (all opinion).[/
    I have no idea where you got $ 720 MM as a critical factor in all of this. Again, the number we are trying to beat, and may in fact beat, is $ 793 MM. We are handicapped to the tune of $ 54 MM but that might be close to be repaired by prior passport shipments. As long as we don't know the mix of total phones sold in Q3, i.e., legacy versus passports, nor do we know what values, charges and obligations were made to sell all of those handsets, we can't determine if passport sales are weak or otherwise.

    It would be helpful if you could explain your $ 720 MMM figure. Thanks
    QUOTE]
    01-08-15 04:40 PM
  24. Komoto's Avatar
    a couple of points:

    Passport is manufactured in Mexico, so has nothing to do with Foxcon.

    Chen definitely stated that out of the 200k initial pre orders, only a small amount of them were counted in the sales figure for Q3 as most of them had not sold through to the end customers.

    To me it sounds as though around 150k of these may not have been counted.

    People need to understand that there is something called Earnings Management. Shareholders like to see long term, steady growth; this is what Chen is doing. He already knows what the next 3 quarters will look like.

    so for q3 he can see if he includes the passport sales he not only shows cashflow positive, but also shows a profit. he doesn't need to tick both boxes.

    it is better to defer some of this income to the next quarter when he knows he will lose more revs from SAF decline and BES12 won't be earning yet.

    In finance if you have a stellar quarter you don't report everything. you look at the next quarter and see whether you can show growth, if not shave something from this and add it to the next. you build quarters with steady QoQ growth, that is what shareholders are rewarding.

    As for the people that are worried about the revs dropping, this should be expected! The old business model is dieing. That isn't the problem, the problem is whether they can replace this with the new revenue.

    The 3.1 billion cash is part of the answer here. they need this as a fail safe whilst the new rev streams become established over the next year. they are hoping to subsidise the loss temporarily with handset sales, but if they don't catch on they need a cushion.

    Assume the handsets don't catch on and they are selling 0.5 mil per quarter. they can still survive for a long time. if they start burning even 200 or 300 mill per quarter they will still be around for years.

    I personally believe in that time BES12 will gain traction and replace a large chunk of the SAF loss. handset sales will stabilise. IOT will start to become more relevant. and they will be able to monetise part of BBM and the patent portfolio.

    This is the investment thesis.

    Posted via CB10
    01-08-15 04:53 PM
  25. BACK-2-BLACK's Avatar
    Nice to see the Fox correspondent had a hard on for him and the company. Back to Black as she put it.

    What you all didn't see after the interview...... she asked the BB Rock Star for an autograph.


    He signed..... "PIMP"


    (she smiled)
    sidhuk, bungaboy, rarsen and 7 others like this.
    01-08-15 04:56 PM
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