BlackBerry's Epic Rise and Fall in 3 Charts

Mired Canadian handset maker BlackBerry (NASDAQ: BBRY  ) officially announced this week what the entire investing community already knew was coming: another absolutely brutal quarter.

The company's name has surfaced in the news on almost a daily basis over the past month, most notably the attempt to find a buyer to take the company private. After having been rumored as the leading candidate to take on this unenviable job, Fairfax Financial agreed to take BlackBerry off the public markets.

However, on this sad occasion (and since chances to cover BlackBerry grow fewer by the day), let's look past the current storylines. I'd like to share three charts that show the rise and fall of this once-great company.

What goes up must come down
It's hard to imagine now, but rewind a few years, and BlackBerry was the toast of the technology landscape.

Led by co-CEOs Jim Balsillie and Mike Lazaridis, Research In Motion, as it was known until earlier this year, grew from a popular pager and PDA business into the company that would help drive the smartphone into the mainstream. Its first device with integrated cell-phone capabilities, the BlackBerry 5810, came to market in 2002. Revenue exploded from that point, taking the company on a wild ride with revenue growing from $294 million in 2002 to an all-time high of $19.9 billion in 2011, a truly mind-blowing average annual rate of 52% during this period.

It's easy to overlook this amazing rise, given BlackBerry's recent struggles, but it's worth noting just how amazing BlackBerry's run over that 10-year period truly was. However, no company's reign can last forever.

Revenue growth began its precipitous decline for the first time last year, although it's fair to argue the music stopped years before thanks to Apple's (NASDAQ: AAPL  ) iPhone and Google's emerging dominance in the global smartphone space. However, when revenue finally began to decline, it quickly erased many of the hard-fought gains of the past several years in a matter of quarters.

Source: S&P Capital IQ.

As the passing of time has only confirmed, Apple completely changed the game when it introduced the iPhone in 2007, ushering in now-common features such as app-based software, touchscreen interfaces, and many other features BlackBerry simply wasn't ready to counter. Google's Android came to market the following year, and the two have never looked back. In the second quarter of this year, Android and Apple accounted for 92% of the global smartphone market share, much to BlackBerry's chagrin.

Source: IDC.

Solid market-share data from several years ago is hard to come by (IDC deletes its data after a few years), but you can certainly understand the dynamic at work here. The key point is that we can see BlackBerry's share of a market -- one that's boomed during this time frame -- slowly, but persistently, trending downward.

It's also worth noting that these market-share figures are also partially influenced by each company's specific smartphone strategy. Google has been able to steal share like no one's business because of the cost advantages it presents to OEMs by offering Android completely open-sourced and basically for free. Its focus is on pushing its search engine and services to as many people as possible.

Apple and BlackBerry, however, rely on an integrated hardware and software strategy. As Apple has proved, this can be an immensely profitable strategy. On the other hand, as BlackBerry has found out, the strategy is almost entirely predicated on consistently rolling out popular devices. Apple has been able to do that, which is why, although its market share has dipped as the market expanded, its profits have are still at all-time highs. Take its most recent sale performances, for instance. In the first weekend of sales of its newest iPhones, Apple was able to sell 9 million units. In its entire quarter, BlackBerry could sell only 3.7 million smartphones.

There are plenty of potential culprits aside from the competition -- perhaps, most crucially, the years of management upheaval and serial delays in bringing the next generation of smartphones to the market. However, the bottom line is that BlackBerry simply lost its lead and never found what it took to recover.

Putting it all together
In the end, what ultimately matters is how shareholders have fared over time. And as with any investment, when someone purchased plays a huge role in determining future returns. However, since we think about investing as a long-term endeavor, let's look at BlackBerry's stock price from the very beginning.

Source: Yahoo! Finance.

If you somehow had the discipline to buy and hold BlackBerry (again, Research In Motion back then) since it was a newly minted public company in the late '90s, chances are you did pretty well. In fact, over its life as a publicly traded company, it's still managed to outperform the Nasdaq. And while things like the tech bubble and the Great Recession obviously distorted pricing and returns to an extent, it's clear that in the end, BlackBerry simply couldn't keep up in an increasingly mobile world.

The growth chapter for BlackBerry ended long ago. The company is now fighting for its life and seeking to find some, if any, way to extend its life as a major tech company. And as we move into this new chapter of the company's corporate history, it's worth looking back to see just how far BlackBerry has come, and just how much it has fallen.

As Wedge Partners analyst Brian Blair summed it up in a recent note to clients: "In the end, though, and this is the end, BlackBerry never did anything well beyond email, and I believe that is why this story is ending."

Life after BlackBerry
BlackBerry's fall means there's more money to be made for today's leading tech titans as they battle it out for the future of a trillion-dollar revolution in mobile. To find out which of these giants is set to rule the next decade, we've created a free report called "Who Will Win the War Between the 5 Biggest Tech Stocks?" Inside, you'll find out which companies are set to dominate, and we'll give in-the-know investors an edge. To grab a copy of this report, simply click here -- it's free!


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