Can BlackBerry Keep Growing From Here?

On Friday, BlackBerry (BB 1.80%) will release its latest quarterly results. As impressive as the stock's recent rebound has been, one big question remains for the company: Do its latest smartphone offerings give BlackBerry the momentum it needs in order to sustain growth beyond a single release?

BlackBerry was once the pioneer of mobile devices for business use, with its ubiquitous physical-keyboard smartphones dominating the industry. But having squandered its lead in the mobile space, BlackBerry now finds itself playing catch-up against strong rivals. 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 report.

Stats on BlackBerry

Source: S&P Capital IQ.

Will BlackBerry's earnings push the stock higher?
Analysts aren't terribly enthusiastic about BlackBerry's stock right now, with an average price target on the shares that's fully 15% below current levels. In the long run, they see BlackBerry's earnings petering out in 2014 and 2015. The stock has tempered its gains, falling about 2% since late March.

The big news for BlackBerry lately has been the release of its BlackBerry 10 smartphones. Just as the Z10 came out last quarter and played a big role in the company's results, the more-recent Q10 release that hit the U.S. earlier this month has investors hoping for even better gains. Some evidence from European sales points to stronger Q10 results than the company saw from the Z10, with many users holding out for the built-in keyboard that's exclusive to the Q10.

But even with the new offering, BlackBerry has fallen behind its rivals. Microsoft (MSFT 1.82%) passed up BlackBerry to become the No. 3 smartphone provider in the world during the first quarter of 2013, with Microsoft's partnership with Nokia having been the determining factor in getting products like the Lumia line of Windows-based smartphones into the marketplace.

Another area where BlackBerry has been weak is in apps, where it has had to resort to working with apps ported from Google's (GOOGL 10.22%) Android operating system. With recent upgrades to its Android emulator, BlackBerry 10 will offer developers an easy opportunity to get access to BlackBerry customers. Yet in the long run, BlackBerry has to work harder to build up its native app content, wooing developers to take full advantage of the company's operating system rather than relying on somewhat out-of-date versions of the Android OS.

In BlackBerry's release, watch for signs that the company has sold enough phones to reenergize its core group of potential long-term customers. With expectations for between 3 million and 4 million smartphone sales in the quarter, BlackBerry needs to work on rebuilding its once-loyal ecosystem if it wants to reenter the ranks of the most influential smartphone makers in the world.

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