[timmy t]

So they are trying to get them out the door and they only allocate a few thousand at this price? Think how great it would have been if they were able to dump 50,000 in three days?
They said the phones were basically worthless so they may as well at least try to get most of their money back and get them into as many hands as possible.

[timmy t]

because they can still sell them and make more money. I am sure they still have people buying them at 349 as well. They still have other carriers that need stock i would hope.

Well, if they are writing them down to zero, get rid of as many as possible and get them into the hands of as many Americans as possible.
They are desperate and yet they are still trying to play it cute?

[RADEoN1337]

lol you throw a phone on sale for 200 unlocked, no matter how "bad" the smartphone is in a consumer's eyes, they will buy it. bad reputation or not.

it's actually a good strategy, if you get it in the hands of a few people, they'll have a few friends that see it etc.

[flacrack]

Well, for me, it's too bad. I was looking to replace my iPhone4. It slowed to a crawl when OS7 went on. Hopefully they will put another sale on soon. I don't want to take a chance on an ebay sale. At the price offered, I'd put up with the slowly resolving app gap. At $400, not so much. I'll still root for Blackberry. They (and ATT) don't make it easy though.

[timmy t]

If you write off $1 Billion for these phones and then sell them for $800,000,000.00, isn't that good for the balance sheet? Like +$800,000,000.00

[timmy t]

Well, for me, it's too bad. I was looking to replace my iPhone4. It slowed to a crawl when OS7 went on. Hopefully they will put another sale on soon. I don't want to take a chance on an ebay sale. At the price offered, I'd put up with the slowly resolving app gap. At $400, not so much. I'll still root for Blackberry. They (and ATT) don't make it easy though.

They seem to be back in stock. I tried but I am in Canada so it would not let me. Oh well, someone is not getting a Z10 for Christmas.

[shupor]

Some good news.

Strange; i was able to purchase a white Z10 about 2 hours ago.

[BBFanIndia]

If you write off $1 Billion for these phones and then sell them for $800,000,000.00, isn't that good for the balance sheet? Like +$800,000,000.00

I haven't seen the exact calculation on they arrived at the $ 1 Billion but I would think it would be something like this -

3 Million BB Z10s in stock valued at a book value (BV) of $ 500 each - $ 1 .5 Billion.

They write down the value (WDV) of each Z10 to $ 200.

Write off per device is $ 300 ( $ 500 BV - $ 200 WDV)

Total loss is $ 300 * 3 Million devices - $ 900 Million

I'll look into the financials and see if they've shared the exact calculation.

[timmy t]

I haven't seen the exact calculation on they arrived at the $ 1 Billion but I would think it would be something like this -

3 Million BB Z10s in stock valued at a book value (BV) of $ 500 each - $ 1 .5 Billion.

They write down the value (WDV) of each Z10 to $ 200.

Write off per device is $ 300 ( $ 500 BV - $ 200 WDV)

Total loss is $ 300 * 3 Million devices - $ 900 Million

I'll look into the financials and see if they've shared the exact calculation.

I don't think they can put the book value that much higher than the cost of manufacturing.

[alan510]

From a financial perspective this does not excite me at all. I expect that the break-even point for a Z10 to be around this point. So frankly, they're not making any money from these sales, or barely at best.
From a marketing perspective this makes me feel good. The best advertising of a product is happy consumers with the product. So let's hope all these new Z10 owners are happy with their phone like I am with mine. However, I hope they weren't all bought by BBOS users just waiting for a cheap BB10 device because we're at a 0 sum game.

Moral of the story, long way to go yet guys and try not to get over excited, there's the simple question of how much stock did they put up online as part of this sale?

I'm not an accountant but aren't any sales now listed as revenue? I believe they wrote down the Z10 inventory last quarter. I think that means they took a big loss then. It also means that any sales now are still counted as revenue but no longer can be seen as taking a loss on the balance sheet. I don't this for sure. Whatever, I do agree with you that putting more devices out there can only be a good thing.

Posted via CB10

[BBFanIndia]

I don't think they can put the book value that much higher than the cost of manufacturing.

I'm almost certain they had amortized R&D and tooling expenses in to the book value. If not and they were carrying them at $ 150 or $ 200 they wouldn't need to write down anything because they could still sell them at cost.

If they expense the R&D upfront and don't amortize it would mean they make a huge book loss in the build up to a launch and a make huge book profit when the devices actually start selling.

I'll look at their filings and post some more information later.

[BBFanIndia]

I'm not an accountant but aren't any sales now listed as revenue? I believe they wrote down the Z10 inventory last quarter. I think that means they took a big loss then. It also means that any sales now are still counted as revenue but no longer can be seen as taking a loss on the balance sheet. I don't this for sure. Whatever, I do agree with you that putting more devices out there can only be a good thing.

Posted via CB10

Correct. I will be revenue but it will not generate any profit unless BB wrote down the value of the Z10 to under $ 200.

[BBFanIndia]

From their financial documents -

"The Z10 Inventory Charge included a write-down of inventory of approximately $627 million and supply commitments of approximately $307 million."

I tried to look through the financials quickly but couldn't find a detailed break down of the Inventory Charge.

They are still carrying a decent amount of inventory which based on what's written in the financial documents is primarily BB 10 products.

I'll post details of how they value their inventory and a paragraph on the Inventory Charge in the next couple of posts.

[BBFanIndia]

Inventory and Inventory Purchase Commitments

Raw materials are stated at the lower of cost and replacement cost. Work in process and finished goods inventories are stated at
the lower of cost and net realizable value. Cost includes the cost of materials plus direct labour applied to the product and the
applicable share of manufacturing overhead. Cost is determined on a first-in-first-out basis.

The Company’s policy for the valuation of inventory, including the determination of obsolete or excess inventory, requires
management to estimate the future demand for the Company’s products within specific time horizons. Inventory purchases and
purchase commitments are based upon such forecasts of future demand and scheduled rollout of new products. The business
environment in which the Company operates is subject to rapid changes in technology and customer demand. The Company
performs an assessment of inventory during each reporting period, which includes a review of, among other factors, demand
requirements, component part purchase commitments of the Company and certain key suppliers, product life cycle and
development plans, component cost trends, product pricing and quality issues. If customer demand subsequently differs from the
Company’s forecasts, requirements for inventory write-offs that differ from the Company’s estimates could become necessary.
If management believes that demand no longer allows the Company to sell inventories above cost or at all, such inventory is
written down to net realizable value or excess inventory is written off.

During the second quarter of fiscal 2014, the Company shipped devices to its carrier and distributor partners to support new and
continuing product launches and meet expected levels of end customer demand. However, the sell-through levels for BlackBerry
10 smartphones decreased during the second quarter of fiscal 2014 due to the maturing smartphone market and very intense
competition. Additionally, delays in the launch of certain functionality of the BES 10 platform and alternative competitor
products in the market have resulted in a slower than anticipated rate of adoption of the BES 10 platform by enterprise
customers, many of which look to deploy BlackBerry 10 hardware and software simultaneously to optimize security through the
integrated BlackBerry end-to-end solution. These factors caused the number of BlackBerry 10 devices in the channel to increase
above the Company’s expectations, which in turn caused the Company to assess and revise its future demand assumptions for
finished products, semi-finished goods and raw materials. Based on these revised demand assumptions, the Company recorded a
primarily non-cash, pre-tax charge against inventory and supply commitments of approximately $934 million, or $1.27 per share
diluted, in the second quarter of fiscal 2014, which was primarily attributable to BlackBerry Z10 devices (the “Z10 Inventory
Charge”).

[BBFanIndia]

Inventory Charge

During the second quarter of fiscal 2014, the Company shipped devices to its carrier and distributor partners to support new and
continuing product launches and meet expected levels of end customer demand. However, the sell-through levels for BlackBerry 10
smartphones decreased during the second quarter of fiscal 2014 due to the maturing smartphone market and very intense competition.
Additionally, delays in the launch of certain functionality of the BES 10 platform and alternative competitor products in the market,
have resulted in a slower than anticipated rate of adoption of the BES 10 platform by enterprise customers, many of which look to
deploy BlackBerry 10 hardware and software simultaneously to optimize security through the integrated BlackBerry end-to-end
solution.

These factors caused the number of BlackBerry 10 devices in the channel to increase above the Company�s expectations,
which in turn caused the Company to assess and revise its future demand assumptions for finished products, semi-finished goods and
raw materials. Based on these revised demand assumptions, the Company recorded a primarily non-cash, pre-tax charge against
inventory and supply commitments of approximately $934 million, or $1.27 per share diluted, in the second quarter of fiscal 2014,
which was primarily attributable to BlackBerry Z10 devices (the �Z10 Inventory Charge�). Significant judgement was required in
calculating the inventory charge, which involved forecasting future demand and the associated pricing at which the Company can
realize the carrying value of its inventory.

Further, the Company�s expectations with respect to its inventory and asset risk (including its ability to sell its existing inventory of BlackBerry 10 products and manage its purchase obligations with its manufacturing partners) and the potential for additional charges related to inventory are forward-looking statements that are subject to the inherent risk of forecasting the Company�s financial results and performance for future periods, particularly over longer periods, given the rapid technological changes, evolving industry standards, intense competition and short product life cycles that characterize the wireless communications industry.

As noted above, these difficulties in forecasting the Company�s financial results and performance are magnified at the present time given the uncertainties related to changes to the Company�s strategy or potential strategic alternatives the Company may pursue as a result of the Company�s ongoing strategic review, including the proposed acquisition of the Company by the Fairfax Consortium. See �Overview - Operational and Strategic Review and CORE Program�, �Cautionary Statement Regarding Forward-Looking Statements� and the �Risk Factors� section of the AIF, which is included in the Annual Report, including the risk factors titled �Intense competition, rapid change and significant strategic alliances within the Company�s industry, including potential future strategic transactions by its competitors or carrier partners, could weaken the Company�s competitive position or may require the Company to reduce its prices to compete effectively� and �The Company faces substantial inventory and other asset risk.�

[mf1982]

Just put an order through half an hour ago and got a confirmation email.

Fingers crossed it comes through. Just glad I finally found someone in the US that I know that will ship it up to Canada for me!

[twstd.reality]

looks like not all of it was fully built and working z10s - only approximately $627 million (if that). there's also the question of what their yield was off the line. that percentage would dictate the amount of units in the bone pile not worth reworking (especially since demand dwindelled) - basically paying their manufacturers to put them in the garbage.

[mnhockeycoach99]

I hesitated for a few minutes and then pulled the trigger on a white Z10 for my wife. Seeing as they are sold out now, I'm glad I didn't wait too long. If she doesn't like it, I guess I can always just sell it on eBay.

[ray689]

I hesitated for a few minutes and then pulled the trigger on a white Z10 for my wife. Seeing as they are sold out now, I'm glad I didn't wait too long. If she doesn't like it, I guess I can always just sell it on eBay.

She'll love it.

Posted via CB10

[VR6]

They couldn't have sold 20M Z10's so quickly...

[Anilu7]

They seem to be back in stock. I tried but I am in Canada so it would not let me. Oh well, someone is not getting a Z10 for Christmas.

I tried a while ago - I just had to change the shipping location to Canada. Yeah - when you go through the checkout, you choose from US, Canada, Mexico.

[Anilu7]

BlackBerry US Online Store

Using this link it appears you can still order. Nor sure if they will cancel orders or not

Z10 leaked 10.2.1.1055

This link still indicated they are available!!

[Huey Newton]

I think if the price was more competitive the z10 would sell

Posted via CB10

[anon(5002059)]

I just bought one for $350 new a week ago from my friend. Oh well. Still very happy with the phone. Best I've ever used.

Posted via CB10

[VR6]

I just bought one for $350 new a week ago from my friend. Oh well. Still very happy with the phone. Best I've ever used.

Posted via CB10

Try contacting BBRY, they might do a price adjustment?