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Why BlackBerry’s betting on new products for future growth

Puneet Sikka

BlackBerry announces mixed Q4 results as its struggle continues (Part 3 of 5)

(Continued from Part 2)

Consistent smartphone sales declines are a worrying sign for BlackBerry

BlackBerry (BBRY) recently announced its fiscal Q4 2014 earnings. Its smartphone sales declined from 1.9 million in fiscal Q3 2014 to 1.3 million in Q4 2014. The most worrying concern for the company is that its smartphone sales continue to decline fast, as the below chart shows. The main reason for this decline for BlackBerry has been its lack of a successful product portfolio—unlike its competitors Samsung (SSNLF) and Apple (AAPL) which have a range of successful products. Though Nokia (NOK) and HTC (HTCKF) haven’t been able to grow their shares in the smartphone market, they’re still giving stiff competition to BlackBerry. However, despite all this, BlackBerry plans to revive its market share through the launch of new products in different markets.

BlackBerry’s betting on new products for a reversal of its fortunes

BlackBerry plans to expand its Z3 smartphone to other regions, Southeast Asia and India, at an attractive price of less than $300. During the conference call to announce earnings, John Chen, the CEO of the company, mentioned, “I think that most of you know this. We will continue to make these devices available, and support the operating system across, as long as there is customer demand. We have a number of exciting new launches sliding up also, as we go forward in the year. First off is of course is Z3 of the Jakarta program, we will be launching for our Indonesian customers. Jakarta has a lavish solid BlackBerry user base in Indonesia and technically positioned us for growth in the emerging market with very attractive price offerings, which is under $300.”

Chen added, “Later in the year, we plan to expand the Z3 to other regions in South East Asia, that is, Thailand, as well as India. We’ll also launch a LTE version of the Z3 phone for the global distribution.”

The company also plans to launch another smartphone named “Classic” by the end of fiscal year 2015. The company is optimistic about Classic’s prospects. Chen mentioned, “We are targeting the calendar Q4 for the Classic to be released. It probably got to be in tandem with the BES 12 releases. This device is obviously for true BlackBerry loyalists and return ourselves to the roots. The customers loves our keyboard, the track pads, the utility belt, the email services, the cut and paste everybody love, and the battery life. To these users, their BlackBerrys are indispensable productivity tools. So early customer feedback on the Classic concept is extremely, extremely positive, and I’ve been going around and talking about that.”

Continue to Part 4

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