BlackBerry Z10 Sales: Smartphone Rumors and BlackBerry’s Reaction
BlackBerry (NASDAQ: BBRY) is fighting back against two financial analysts’ reports that return rates for its new Z10 smartphone in some cases are exceeding sales in the U.S. The mobile device maker launched the Z10 in the U.S. on March 22 to a lukewarm reception, although it reported a week later that it sold 6 million smartphones during its Q4 2013, including some 1 million BlackBerry Z10 units outside the U.S.
How are initial BlackBerry (NASDAQ:BBRY) Z10 smartphone sales? BlackBerry is fighting back against two financial analysts’ reports that Z10 returns in some cases are outpacing U.S. sales. The mobile device maker launched the Z10 in the U.S. on March 22 to a lukewarm reception, although it reported a week later that it sold 6 million smartphones during its Q4 2013, including some 1 million BlackBerry Z10 units outside the U.S.
Now, according to an account in The Wall Street Journal, a report from Detwiler Fenton analyst Jeff Johnston claimed that user returns of the Z10 are overtaking sales of the device. “We believe key retail partners have seen a significant increase in Z10 returns to the point where, in several cases, returns are now exceeding sales, a phenomenon we have never seen before,” Johnston is quoted as writing in the report.
A second report by Joe Fersedi, an ITG analyst, as reported in the Journal, claimed sales of the Z10 have slipped from the initial weak launch and barely exceed the vendor’s older models. Fersedi wrote that Z10 sales at AT&T stores, the device’s U.S. launch point had fallen from 7 percent to no higher than 2 percent.
BlackBerry quickly disputed the Detwiler report, issuing a statement calling “speculation” of “abnormally high levels” of customer returns for the Z10 device “absolutely false” and claiming the return rate was consistent not only with its own expectations but also with that of other high-end smartphones on the market. "Our data shows that return rates for BlackBerry Z10 devices both in the U.S. and on a global basis are in line with or better than our expectations and are consistent with return rates for other premium smartphones in the market today,” the company said.
Last Friday, BlackBerry president and CEO Thorsten Heins punched back even harder, saying the company will ask the U.S. Securities and Exchange Commission and the Ontario (Canada) Securities Commission to investigate the Detwiler report, calling it “either a gross misreading of the data or a willful manipulation.”
To make matters worse for BlackBerry, a recent survey commissioned by institutional investor MKM Partners showed that more than eight in 10 Americans don’t know that BlackBerry has launched either the new Z10 smartphone or a new operating system. User awareness lagging to that low a level doesn’t bode well for BlackBerry’s chances to gain ground on market honchos Apple (NASDAQ: AAPL) and Samsung, at least not in the short term.
On the bright side, analysts expect the forthcoming Q10 device to sell better than the Z10.