BlackBerry Earnings: An Early Look

Earnings season is just about over, with almost all companies already having reported their quarterly results. But there are still a few companies left to report, and BlackBerry (BB -0.69%) is one of them. The key to making smart investment decisions with stocks releasing their quarter reports is to anticipate how they'll do before they announce results, leaving you fully prepared to respond quickly to whatever inevitable surprises arise.

Until recently, just about everyone believed that BlackBerry had fatally dropped the ball on its chance to dominate the mobile space. But now, the company is casting its lot on a new smartphone offering that's generating some buzz. Let's take an early look at what's been happening with BlackBerry over the past quarter and what we're likely to see in its quarterly report on Thursday.

Stats on BlackBerry

Source: S&P Capital IQ.

Will BlackBerry make a connection this quarter?
Analysts aren't terribly optimistic about BlackBerry's prospects to regain profitability either this quarter or for the foreseeable future. S&P Capital IQ projects losses through 2016, with revenue failing to regain its 2012 levels. But the stock has rocketed higher by more than 35% since late December.

BlackBerry has suffered from rapidly declining market share over the past year, as Google-driven (GOOGL 0.55%) Android devices have grabbed up sales from just about all of the major players in the industry. With BlackBerry having seen defections among corporate customers in light of changing views on enterprise security issues, it lost one of its biggest competitive advantages over its rivals. Home Depot's decision to replace BlackBerry's operating system with Apple's (AAPL 1.27%) iOS is just one in a long series of these moves.

But investors have put their hopes on the BlackBerry 10 operating system, which launched back in January. Early demand in Canada and the U.K. appeared promising, and the company got an order for 1 million smartphones earlier this month, demonstrating confidence in the new products. But the true test came over the past weekend, when the new Z10 smartphone became available to U.S. consumers.

Another thing pulling BlackBerry stock up has been the possibility of its being acquired. Earlier this month, Lenovo said that a BlackBerry acquisition "could perhaps make sense," sending shares up more than 10% in a single day. A combination of smaller players in the space joining forces to compete against Google and Apple might be their only chance to survive against the giants in the space.

In its quarterly report, BlackBerry needs to explain its future strategy to investors in light of the U.S. Z10 release over the weekend. Without strong results, investors will start to lose their newfound confidence in BlackBerry.

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