BlackBerry’s Latest Offerings Impress, Smartphone Woes Remain – Analyst Blog

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A healthy balance sheet, an extensive patent portfolio, launch of the BES12 platform, presence in over 147 countries, the partnership with Foxconn and NantHealth are a few strengths BlackBerry Limited (BBRY) presently boasts. Moreover, acquisition of Secusmart and Movirtu coupled with the launch of the BBM messenger on Android smartwatches are likely to propel growth going forward.

In order to target the automotive and asset tracking industries and to add a revenue stream, BlackBerry launched the Internet of Things (IoT) platform.  Meanwhile, the company’s large screen smartphone, Passport, has hit AT&T stores and is available at a minimum down payment scheme.

In the third quarter of 2015, BlackBerry reported a significantly narrower operating loss of $139 million compared with $198 million in the year-ago quarter. Meanwhile, free cash flow stood at $388 million against $177 million in the year-ago quarter.

Meanwhile, all hasn’t been good for the company. BlackBerry has been facing declining smartphone sales, stiff competition from handset manufacturers, a lackluster operating platform and a change in business model for quite some time now.

In the third quarter, BlackBerry sold 1.9 million smartphones against 4.3 million in the same period last year. The count stands significantly below Samsung’s 73.2 million and Apple’s 38.2 million. This hints at the company’s growing trouble in the high-end smartphone business.

BlackBerry’s declining smartphone sales coupled with a deteriorating handset market share have raised considerable concern among industry analysts. Unlike the Android and iOS platform, BlackBerry lacks a popular operating system, which has been largely affecting its sales. Total revenue in the third quarter stood at $1,193 million, down 33.5% year over year.

BlackBerry currently has a Zacks Rank #2 (Buy).

Stocks That Warrant a Look

Other stocks which also warrant a look in this sector include China Unicom (Hong Kong) Ltd. (CHU), NTT DOCOMO, Inc. (DCM) and China Mobile Ltd. (CHL). China Unicom sports a Zacks Rank #1 (Strong Buy) while NTT DOCOMO and China Mobile Ltd. hold a Zacks Rank #2.

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