First, a round-up of the quarter’s numbers:
- 14.2 million devices shipped, sell-through: 12.3 million
- expect to ship 14.5 to 15 million units in the next quarter
- ASP of approximately $315
- US, UK and Canada are 56% of sales
- US represented 34% of the total revenue
- Last year US represented 57% of revenue
- BlackBerry Torch launched in over 75 new markets, Torch launched with the $99 pricing from AT&T
- BlackBerry Curve 3G launched with 118 carriers in 48 countries
Much has been made of the potential for Android to reduce the growth of iPhone. The iPhone seems to be doing very well and continuing to be supply rather than demand constrained.
RIM however seems to be under significant pressure. A Goldman Sachs analyst first pointed this out in her last report and placed a “Sell” on RIMM. The fact is that most of RIM’s sales are in the US on the carriers other than AT&T. In those very same carriers, Android is being pushed hard as a customer retention strategy, so iPhone is pressuring RIM only indirectly through Android.
The evidence is also in survey data. In the graph below, we see how iPhone buyers are considering Android as the most credible alternative to the iPhone whereas they considered BlackBerry the best alternative a year ago. In terms of vendors, what RIM lost HTC gained.
One can only wonder what will happen when the iPhone enters unrestricted distribution in the US. The results in other markets speak for themselves.
AppleInsider | Apple’s recurring revenue stream: 77% of iPhone 4 sales were upgrades.
RIMM shares dropped more than 5% after hours after company reported “light” units and a 20% rise in profit with a 24% rise in revenue.
RIMM sold 11.2 million units (of which 4.9 million were new subscribers and the rest replacement units–a deterioration in replacement rate). This represents 43% growth. The unit growth is nearly double the revenue rise implying a lower ASP ($300–half the iPhone) and margin (45.4%).
RIM passed another milestone: 100 millionth BlackBerry was sold during the quarter. We’ve noted before that Apple will also pass its 100 millionth iOS device this month. RIM sold 20 million units as of October 2007, right on the heels of the iPhone launch. That means that iOS grew 100 million to BlackBerry OS growing 80 million in the same time frame.
So why are shares at a P/E of 13? 20% EPS growth would be respectable numbers, but the smartphone market is growing faster than that. The implication is that RIMM is losing share and everyone is expecting that loss to accelerate.
Simona Jankowski from Goldman Sachs repeats her Sell rating. “RIM has now missed top-line expectations for three of the last four quarters, in our view demonstrating the building competitive pressures on its business from the iPhone and more recently from Android,” she writes. “We estimate that net subscriber additions in North America declined on a sequential basis, which we attribute primarily to the success of Android-based phones, such as the Motorola Droid and the HTC Incredible at Verizon.”
Research In Motion Limited (USA): NASDAQ:RIMM quotes & news – Google Finance.
Today, Research in Motion co-CEO Jim Balsillie said his BlackBerry App World has 20 million registered users and nearly 1 million daily app downloads.
via Apple Doing 10-20X As Many App Downloads A Day As BlackBerry.
As previously stated, The App download rate increased to a record 10,753,000 per day during the last 90 days. That makes the download rate for the iPhone platform 10x that of the Blackberry Platform. The iPhone platform is nearing 100 million installed base. Blackberry is citing 20 million registered users. I think everyone is pretty clear on where this is going.