BlackBerry share price falls, stock downgraded

BlackBerry's share price fell and its stock was downgraded today just days ahead of its quarterly results, following reports of a lacklustre new smartphone launch in the US.

BlackBerry's quarterly results, due for release on Thursday, will offer the first concrete gauge of how the company's new Z10 smartphone is being received across Britian and Canada, where it has been available for more than a month.

The company only began selling the smartphone in Australia this week, and sales in the US region began last Friday. 

The phone received little to no fanfare in the US, prompting Goldman Sachs to cut its rating on BlackBerry to "neutral" from "buy". Goldman cited little marketing support from the company and apparently low sales.

The Goldman report, coupled with other media and analysts' reports of a flat US debut, have pulled down the volatile stock more than 11 percent on the Nasdaq since Friday, including a fall of 4.5 percent to $US14.23 on Monday.

Nevertheless, an upbeat forecast from the company on Thursday could push BlackBerry shares higher again, said Eric Jackson, founder and managing Partner of Ironfire Capital LLC, which owns shares in BlackBerry.

"Even if they report a so-so quarter ... If they provide robust guidance for the current quarter that could really light a fire under the stock," said Jackso.

Low expectations

BlackBerry unveiled the Z10 on January 30 and has reported fairly solid demand for it in its home country, Canada, and in other countries such India and the United Arab Emirates, where BlackBerry still has a strong brand and presence.

But the late debut in other major markets such as the US and Australia, due to a longer carrier testing process, and the muted reception in the US has cast doubts on BlackBerry's chance of a turnaround.

The Z10 is the first in a line of devices that will be powered by BlackBerry's new BB10 operating system. It is a key part of the company's attempt to regain relevance and win back market share in the smartphone arena that it once dominated.

"It remains to be seen if BlackBerry 10 can gain mainstream acceptance against Android and (Apple's) iOS," said Sterne Agee analyst Shaw Wu.

"We anticipate a decent quarter as expectations are low," Wu said. "However, we remain on the sidelines as we are concerned with lack of profitability."

Analysts, on average, expect BlackBerry to report a loss of 29 cents a share in the period on sales of $US2.8 billion, according to Thomson Reuters I/B/E/S. Wall Street will be looking for sales of about 1 million Z10 devices in the quarter.

Shares of BlackBerry closed down 68 cents at $US14.23 on the Nasdaq on Monday, while its Toronto-listed shares fell 68 Canadian cents to C$14.51.