Some industry watchers had high hopes for BlackBerrys (BBRY) first next-generation smartphone in its debut quarter, but it looks like they may have gotten ahead of themselves. Now, the Street is revising its estimates in light of a slower than expected rollout and what appears to be a softer launch than many had hoped for.
Canaccord Genuity analyst T. Michael Walkley had initially called for BlackBerry to sell about 1.75 million BlackBerry Z10 smartphones in the February quarter. But after his checks following the phones launch in the UK and Canada found limited initial supply and softer than expected demand, the analyst slashed his estimates for the current quarter from 1.75 million units to just 300,000.
Our global surveys post the recent BlackBerry Z10 launch indicated mixed initial sales with limited initial supply cited as the reason for early post-launch stock-outs at some carrier stores rather than overwhelming demand, Walkley wrote in a note to investors. Our follow-up checks have indicated steady but modest sales levels. With new BB10 smartphones launching in the U.S. only in mid-March or later at subsidized prices no better than competing high-end Apple/Samsung smartphones, combined with our expectations for the Galaxy S IV to launch at a similar time frame in the US market, we are lowering our BB10 sales estimates for the February quarter and all of F2014.
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