Research In Motion Ltd (BBRY)’s Quarter Couldn’t Be Worse

BlackBerry backtrack
BlackBerry also made some important announcements that appear to be strategic concessions. First, Heins reversed his stance on bringing BB10 to the company’s aging PlayBook tablet, which will no longer get the update previously announced, saying only that the performance didn’t meet expectations. That makes sense since the device was originally launched over two years ago and has not received any major hardware updates since. PlayBook shipments were the lowest on record, putting it low on the priority list of getting BB10.

Source: BlackBerry. Fiscal quarters shown.

Perhaps more interesting was that Research In Motion Ltd (NASDAQ:BBRY) said it would release a new phone this year on the older BlackBerry 7 platform, citing continued demand for older models like the Bold 9900. That shows that the company intends to reinforce its position in emerging markets where lower-end BB7 devices sell better.

The challenge there is that the low-end of the market is quickly being taken over by low-cost Google Inc (NASDAQ:GOOG) Android and Nokia Corporation (ADR) (NYSE:NOK) Asha devices. Meanwhile, the high-end in developed markets is totally dominated by Apple Inc. (NASDAQ:AAPL) and Samsung.

The gloomy figures will inevitably spark takeover talk again, since shares have plunged by as much as 29% today. That’s brought BlackBerry’s market cap down to $5.4 billion, meaning its $3.1 billion in cash is now over half of its valuation. BlackBerry may be cheap right now, but it’s a classic value trap.

The article BlackBerry’s Quarter Couldn’t Be Worse originally appeared on Fool.com and is written by Evan Niu, CFA.

Fool contributor Evan Niu, CFA, owns shares of Apple. The Motley Fool recommends Apple and Google. The Motley Fool owns shares of Apple and Google.

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