BlackBerry’s U.S. Z10 Launch a Yawner

Despite big marketing push, America shrugs at new BB10 product

   

After a big weekend in the U.S. — the launch of the new Z10 smartphone running the new BB10 operating system — it’s time to see how BlackBerry (NASDAQ:BBRY) is faring in its comeback bid.

As was the case a couple weeks ago, the answer is “meh.”

Lineups failed to materialize, some stores reportedly didn’t bother even unpacking their new BlackBerries and sales appear to have been tepid. Goldman Sachs cut its rating of the company based on the “disappointing U.S. Z10 launch,” and BlackBerry stock was headed down by about 5% in Monday morning trading.

A Mixed Bag

2013 hasn’t exactly been a disaster for the struggling Canadian company, but the dream of a triumphant January unveiling turning into a landslide of sales and a path to revitalization has hit a series of speed bumps. The critical U.S. launch of new devices was delayed, sales in Canada and the U.K. haven’t appeared to be overwhelming and the Q10 (the QWERTY keyboard-sporting new BlackBerry holdouts have been waiting for) is now expected to be held up until May or even June.

This all sounds bad, but there have been positives along the way, too, such as some decent reviews of the Z10 and news of a mystery buyer snapping up 1 million units of the new smartphones.

As a result, the stock has been on a roller coaster ride this year. While bad news has been countered by good, BBRY has bounced up and down, gaining and losing as much as 30% from week to week.

The Z10 has been available in Canada and the U.K. for weeks, but it was the U.S. launch that was seen as being the key indicator to the company’s future prospects.

If that’s true, given the lackluster Z10 sales over the weekend, BlackBerry had better do something to speed up availability of the new QWERTY keyboard Q10.

Despite its biggest marketing campaign ever — including a Super Bowl ad — it looks as though BlackBerry moved few Z10s over the weekend. Even worse, there seemed to be a distinct indifference among both consumers and retailers. PhoneArena reports that AT&T’s (NYSE:T) two Manhattan stores saw under 20 people showing up to buy Z10s, and most of these were to replace old BlackBerries; a San Francisco AT&T store hadn’t even bothered moving the new phone out of its storeroom for the launch.

According to the Financial Post, analysts checked 20 AT&T outlets across the U.S. and found each was given a small allocation of Z10s … and no stores sold out. Lack of signage and burying the display model Z10 among other smartphones also was common — an unusual lack of support during a major product launch. Can you imagine AT&T treating Samsung (PINK:SSNLF) or Apple (NASDAQ:AAPL) launches this way?

All is not lost, of course. Other U.S. carriers will get the Z10 soon, and that might help to kickstart sales. T-Mobile, Verizon (NYSE:VZ) and Sprint (NYSE:S) all start selling it on March 26.

And, as pointed out in the CrackBerry forums, AT&T might not be doing much for the Z10 in-store, but the phone at least was featured prominently on its website as of this writing, sharing top billing with the HTC One X.

What’s Next

The next big date for BlackBerry will be Thursday, when it releases Q4 financial results and quantifies those early Z10 sales numbers, which it has kept close to its chest, using vague terms like “better than expected” and “exceeds our expectations.” It will be too early for U.S. launch data to make it in, but it’s possible that CEO Thorsten Heins will speak to how things went this past weekend.

Either way, we’ll find out on Thursday whether BlackBerry’s been blowing smoke the past six weeks, or whether Z10 sales really did outperform expectations.

And, as has been the pattern this year, you can expect BBRY stock to either take a dive or get a huge boost at the end of the week, depending on the news.

As of this writing, Brad Moon did not hold a position in any of the aforementioned securities.


Article printed from InvestorPlace Media, http://investorplace.com/2013/03/blackberrys-u-s-z10-launch-a-yawner/.

©2014 InvestorPlace Media, LLC

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