BlackBerry Ltd. BBRY recently introduced the much-awaited Android device – Priv – putting speculations surrounding it to rest. Notably, with this device, the company will be venturing out by using Google’s GOOG Android OS instead of its own for the first time. This will likely solve BlackBerry’s biggest issue – the lack of popular consumer apps.
Recent Undertakings
BlackBerry has been struggling to reinvigorate sales at its deteriorating handset business. At present, the company’s market share significantly lags that of Apple Inc. AAPL, Sony Corp. SNE and Samsung. The company reported sales of nearly 800,000 units in the second quarter of fiscal 2016, indicating a 67% decline on a year-over-year basis. Meanwhile, BlackBerry shifted its focus to software services, where revenues improved about 19% this quarter. Also, the company recently penned an agreement to acquire mobile security firm Good Technologies Ltd., in a bid to strengthen its position in the Enterprise Mobility Management service space.
A Trump Card?
Android OS is powerful and popular, holding 83% of the global smartphone market. However, being an open source platform, there are concerns related to security and privacy. BlackBerry sees this as an opportunity to add something new to the already saturated Android smartphone market by creating an Android device with BlackBerry’s popular security features. This might well be the company’s ticket to success.
Bottom Line
Although BlackBerry has been diversifying its operations by foraying into value-added software services, hardware remains a key part of its business. Stringent cost management is the company’s new strategy for a rebound. Meanwhile, it is to be seen how the company progresses with its organic growth and Android market plans.
BlackBerry currently carries a Zacks Rank #5 (Strong Sell).
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