[eshropshire]

Stock bumped and settled to the 7-8 range- just as I have said Chen wants it- my theory is all holding true thus far.

A year from now stock will remain relatively unchanged with maybe another "last" chance get out for some @ a 9 or 10$ rally- 1 or at most 2 PY's from now a sale of BlackBerry will happen, in my guess to SAP or subsidiary.

Chen is about 50% done now in a slow and justifiable exit from handsets- he either leaves with nothing to add to the table but existing patents, or the priv was "successful" in giving them some marketable app's to license to other OEM's. Either way, it's going to be gone before the sale- the parent "new" parent company does not want to be the ones seen as chopping it.

What I don't have a guess on is if Chen is aiming to golden parachute during all of this or end up a high ranking higher paid do nothing figurehead VP @ SAP by the time this is all done.


Posted via CB10

Last thing Chen wants or needs is to be a VP at any company. Chen did not want to be CEO of BlackBerry, he took the job on a temp basis and kept it because no else qualified wanted the job. The BB Board is paying him a big salary to try and save BB after years of terrible management from Jim, Mike and Thor.

The fact that BB is still going and it is almost 2016 is amazing. I guess people forget how bad things were two years ago. BB was burning through tons of cash. BB10 1.x was bad, launched way too late but was still not ready hurting early adopters (not fanboys). The returns greatly hurt BB relationship with resellers. BB10 1.x issues and poor forcasting by BB led to a huge inventory of unsold BB10 phones that tied up a lot of BB liquidity. Not to mention the big part of BB revenue was services and it's revenue was falling fast with no hope of recovery. Add to this BB BES 10 was a disaster.

BB still has a long hard road ahead if it is going to survive. One positive sign for BB is the amount of media coverage BB has received in 2015, and most of the coverage is positive. Trade journal actually quote Chen and seek out his comments. I think you need to go back before 2010 to see this much positive coverage on BB.

[kirson]

It's going to be an interesting day on Friday, regardless. I agree with most in this thread that we will get very little specific details about Priv sales - the "in line with expectations/exceeding expectations" type of language is, in my view, the most likely. But there is A LOT going on with Blackberry that we ignore in these forums most of the time:

- There is a report that required royalty payments have been significantly reduced - this will have a very meaningful impact on earnings.
- There was the cost of the Good acquisition - this will have a meaningful impact on cash reserves.
- BIS services are not really offered in most areas anymore - this will meaningfully impact revenues and earnings.
- There is no recent news of new licensing arrangements - this could mean Software & Licensing revenues are flat or down.

I think this is going to be a lot like previous earnings releases. The facts will not support much in the way of good news. But the STORY is what will continue to count. If Chen can continue to tell the story well and get the street excited about FUTURE sales and revenues, then the street will give him a pass for another quarter. Like it or not, unless cash starts to shrink at an alarming rate, this is likely going to be the way these calls go for many quarters to come.

[The Commander]

BBRY (TSX) 11.49

Posted via the CrackBerry App for Android

[anon(8865116)]

It's going to be an interesting day on Friday, regardless. I agree with most in this thread that we will get very little specific details about Priv sales - the "in line with expectations/exceeding expectations" type of language is, in my view, the most likely. But there is A LOT going on with Blackberry that we ignore in these forums most of the time:

- There is a report that required royalty payments have been significantly reduced - this will have a very meaningful impact on earnings.
- There was the cost of the Good acquisition - this will have a meaningful impact on cash reserves.
- BIS services are not really offered in most areas anymore - this will meaningfully impact revenues and earnings.
- There is no recent news of new licensing arrangements - this could mean Software & Licensing revenues are flat or down.

I think this is going to be a lot like previous earnings releases. The facts will not support much in the way of good news. But the STORY is what will continue to count. If Chen can continue to tell the story well and get the street excited about FUTURE sales and revenues, then the street will give him a pass for another quarter. Like it or not, unless cash starts to shrink at an alarming rate, this is likely going to be the way these calls go for many quarters to come.

disagree with your last few Points. first, good should count almost entirely as under software and should be around 35-75 million based on their revenue last year.

second, Chen said we should see an uptick of licensing in Q3 and Q4 during the Q1 conference call. since most of the contracts are private there's no real news they can really give.

lastly, sort of agree that Wall Street may give him a pass if he has a good story but most analysts have written off bbry already thinking there will be more losses before any kind of rebound. Falling MdM, bbos fees, and devices are blackberrys bread and butter. none of these are making any kind of huge strides. so all u really have left is licensing fees and "software" which is a pretty lame story for shareholders

[sorinv]

Well, we now know.
222.8M hardware sales fewer than 317K Priv sold assuming 699USD per Priv and no sales of any BB10 phone.
We can safely say that fewer Priv's sold in November 2015 than Passports in September (2-3 days of sales) 2014.

[conite]

Well, we now know.
222.8M hardware sales fewer than 317K Priv sold assuming 699USD per Priv and no sales of any BB10 phone.
We can safely say that fewer Priv's sold in November 2015 than Passports in September (2-3 days of sales) 2014.

They had little to no stock of Priv prior to Nov28. We need far more information before anything useful can be ascertained.

[theboogeyman]

Well, we now know.
222.8M hardware sales fewer than 317K Priv sold assuming 699USD per Priv and no sales of any BB10 phone.
We can safely say that fewer Priv's sold in November 2015 than Passports in September (2-3 days of sales) 2014.

There had to be sales of BB10 since the 700K units sold had average price of $315..an awful number no matter how you spin it

[theboogeyman]

They had little to no stock of Priv prior to Nov28. We need far more information before anything useful can be ascertained.

the usual excuse no stock available..

[conite]

Doesn't change the fact though. They obviously had serious inventory problems. Apart from some pre-sales, you can't sell phones you don't have.

[early2bed]

Doesn't change the fact though. They obviously had serious inventory problems. Apart from some pre-sales, you can't sell phones you don't have.

There's also no chance of having to write-down handsets that you have ordered an couldn't sell, which is the main reason why TH was fired and John Chen hired. He also outsourced the inventory risk to manufacturers so, of course, they must have been conservative about what components they ordered.

The only way that the Priv will save the BlackBerry hardware program is by allowing Chen to eliminate BB10 platform development costs.

[mister2d]

There had to be sales of BB10 since the 700K units sold had average price of $315..an awful number no matter how you spin it

His estimate was an upper boundary best guess. If you factor in any BB10 hardware sales, then the number becomes more bleak for Priv sales.

[sorinv]

His estimate was an upper boundary best guess. If you factor in any BB10 hardware sales, then the number becomes more bleak for Priv sales.

Indeed. Now we know even more. The number is somewhere between 96k and 160k.

[sorinv]

There's also no chance of having to write-down handsets that you have ordered an couldn't sell, which is the main reason why TH was fired and John Chen hired. He also outsourced the inventory risk to manufacturers so, of course, they must have been conservative about what components they ordered.

The only way that the Priv will save the BlackBerry hardware program is by allowing Chen to eliminate BB10 platform development costs.

This was only true when Heinz left. All his z10 were later sold by Chen and claimed in revenue if they were written off by Heinz. If they were not written off then they were not lost revenue.

You cannot have it both ways. Z10 sold in much greater numbers than any BB10 phone and in greater numbers than the 5M target that Chen set for all his phone sales this year, including the Priv.

They may have been sold at lower price, at a loss, but they were not totally written off. Revenue was made on every single one of them.

[conite]

Indeed. Now we know even more. The number is somewhere between 96k and 160k.

Which is pretty much all he had available to sell.

My initial hunch was that only 100k units made it out of production for sale in Nov.

[jay64]

Nice summary, Kirson

[eshropshire]

This was only true when Heinz left. All his z10 were later sold by Chen and claimed in revenue if they were written off by Heinz. If they were not written off then they were not lost revenue.

You cannot have it both ways. Z10 sold in much greater numbers than any BB10 phone and in greater numbers than the 5M target that Chen set for all his phone sales this year, including the Priv.

They may have been sold at lower price, at a loss, but they were not totally written off. Revenue was made on every single one of them.

Actually they had to write off the difference in value they had accounted for the z10s vs the actual selling price. Go back and look at the big write down they had to take in 2013.

MS had to do something similar in 2013 with their Surface inventory. They had to write off 1 billion in value. MS did not throw all the unsold Surfaces away. They did give a few away, but most were sold but at massive discounts. BB did the same thing with the unsold z10s.

[kirson]

So, I ran some number is Excel. Not sure if this ties directly to the call, but here were my inputs:

Last Q we had device sale revenues of $201 million with ASP of $240. Conclusion: we sold 837,500 units (Chen called this 800,000).
This Q we had device sale revenues of $214 million with ASP of $315. Conclusion: we sold 679,365 units (Chen called this 700,000).

I made two assumptions:
(1) the ASP for the old devices stayed at $240.
(2) the ASP for the Priv was $600.

I then ran the solver in Excel to iterate until all these numbers and ratios worked. The solver said that to get those two ASP numbers, the company had to sell 537,831 old devices at $240 per device (a reduction of 36% from last quarter) and 141,534 Priv's at $600 per device. This resulted in the $315 overall ASP.

If I change the ASP on the Priv to $550, Excel calculates that the company sold 164,363 Priv units.
If I change the ASP on the Priv to $500, Excel calculates that the company sold 195,971 Priv units.
If I change the ASP on the Priv to $450, Excel calculates that the company sold 242,631 Priv units.
If I change the ASP on the Priv to $400, Excel calculates that the company sold 318,453 Priv units.

So, now you have a relatively good framework on Priv sales. If the assumption for old device ASP staying at $240 is correct, you now know how many Priv units were sold assuming a range on Priv ASP from $400 to $600.

[Q10Bold]

Hahahaha

Posted via PP

[RubberChicken76]

You cannot have it both ways. Z10 sold in much greater numbers than any BB10 phone

It would seem so, though I've never actually seen the BlackBerry 10 numbers actually broken out. That said, I don't need to tell you obviously that with the write down (not write off), those units were sold at a discount/probably a loss and the model obviously wouldn't be sustainable to maintain.

For example, suppose they sold 5 million Z10s at $200 a pop ASP. Hot damn! That's a billion in revenue!

But what if it cost them $320 to build each one on average? Well suddenly they've spent $1.6 billion on inventory and are $600M in the hole even before they've spent any money on anything else like marketing, sales, returns, customer service etc.

Now suppose they've sold a million passports and privs at an ASP of $450, and their average costs are $320. Now all of a sudden, they're $130,000,000 ahead.

My point is that it's entirely possible to have a small niche business that's profitable; while correspondingly pushing hard into an initiative that nearly kills the company.

The Z10 was a debacle (and I say this as an owner of one) from a financial perspective. They stuffed the channel/warehouses in expectation of a huge launch and the sales didn't come. Then they had to sell units at a big loss in order to at least recoup part of their investment.

I can see why Chen is being cautious with his inventory, even if it doesn't mean gangbuster numbers. BlackBerry really can't afford another massive write-down after the PlayBook or Z10. He spent many quarters clearing up that mess, which was very much under his predecessor's watch.

It's totally true that nothing seems to have sold as well as the Z10. On the other hand, he also hasn't had to do massive write-downs on any releases that he's done either.

[Superfly_FR]

[...]
So, let's wait for the sentence "launch in [put your country here] starting [put a date here]".
The more occurrences we have for countries and the shorter delay, the best sign it'll be.

Make it 31 (countries) and 2.5 months.
Good enough ?
Me like.

Posted via the CrackBerry App for Android

[mister2d]

So, I ran some number is Excel. Not sure if this ties directly to the call, but here were my inputs:

Last Q we had device sale revenues of $201 million with ASP of $240. Conclusion: we sold 837,500 units (Chen called this 800,000).
This Q we had device sale revenues of $214 million with ASP of $315. Conclusion: we sold 679,365 units (Chen called this 700,000).

I made two assumptions:
(1) the ASP for the old devices stayed at $240.
(2) the ASP for the Priv was $600.

I then ran the solver in Excel to iterate until all these numbers and ratios worked. The solver said that to get those two ASP numbers, the company had to sell 537,831 old devices at $240 per device (a reduction of 36% from last quarter) and 141,534 Priv's at $600 per device. This resulted in the $315 overall ASP.

If I change the ASP on the Priv to $550, Excel calculates that the company sold 164,363 Priv units.
If I change the ASP on the Priv to $500, Excel calculates that the company sold 195,971 Priv units.
If I change the ASP on the Priv to $450, Excel calculates that the company sold 242,631 Priv units.
If I change the ASP on the Priv to $400, Excel calculates that the company sold 318,453 Priv units.

So, now you have a relatively good framework on Priv sales. If the assumption for old device ASP staying at $240 is correct, you now know how many Priv units were sold assuming a range on Priv ASP from $400 to $600.

Kudos for using the solver in Excel.

[theboogeyman]

Make it 31 (countries) and 2.5 months.
Good enough ?
Me like.

Posted via the CrackBerry App for Android

I do not like it because in less than few months some of the big Android oems will release new phones and at which time the Priv will be even more outdated than the current flagships. Samsung is expected to release the S7 early 2016 and so is HTC.

[lift]

There are already a few phones out right now that are better spec and a lot cheaper than the Priv and it's going to keep getting worse for BlackBerry.

[conite]

I do not like it because in less than few months some of the big Android oems will release new phones and at which time the Priv will be even more outdated than the current flagships. Samsung is expected to release the S7 early 2016 and so is HTC.

And Chen specifically said he will reduce the price of the Priv over time to reflect that.

[sorinv]

Which is pretty much all he had available to sell.

My initial hunch was that only 100k units made it out of production for sale in Nov.

Which is very strange because the first batch of Passports was 300k and everyone, including Chen, was convinced that Priv would outsell all BlackBerry 10 phones combined. Why would he produce such a small batch then?