BlackBerry Survival: Discard hardware, betting software

The investment company William Blair & Co said that the BlackBerry's temporary CEO, John Chen, could shut down his Chen smartphone business and focus on profitable business software. According to Bloomberg data, software vendors are typically worth 3.3 times times their annual revenue, and the company's bid to buy blackberries is just 0.17 times times the revenue. As long as smartphone business continues to lose money and users continue to lose, there is no reason to buy BlackBerry stocks, Nomura said. "BlackBerry should quit the smartphone business so it looks more like a software vendor," Anil Doradla, an investment company analyst Annier Doradala, said in a telephone interview. This strategy does not ensure that the BlackBerry will succeed, and its success depends on implementation, but it is the most reasonable strategy. "After a 4.7 billion dollar sale of the company, the BlackBerry no longer sought to sell the company, but dismissed CEO Sosten Heins (Thorsten Heins) and appointed Sybase Forefoot Chen as interim CEO. The BlackBerry financed 1 billion dollars by issuing convertible bonds, of which the company subscribed for $250 million. Michael Genovese, an investment company analyst at MKM, Michael Ginovis, said that while issuing bonds helped improve the viability of the BlackBerry, it was only a stopgap measure. "We think the financing is more symbolic," Genovese said in a report published November 4. We think that the amount of money on the BlackBerry is going to burn, and when it comes to BlackBerry valuations, we don't think about cash reserves. Two unnamed sources said that in addition to issuing bond financing, BlackBerry is also seeking the Canadian government before the end of the tax rebate of 1 billion U.S. dollars. As of August 31, BlackBerry has 2.34 billion dollars in cash and cash equivalents, as well as a long-term investment worth 225 million of dollars. Sales fall The BlackBerry's 1.57 billion-dollar revenue in the latest quarter is only about half as analysts expect, the lowest level since 2007. The BlackBerry sold more than $374 million trillion in sales, as smartphones unsalable writedowns of $934 million trillion in assets. In addition, the BlackBerry also cut about 40% staff. "As long as the BlackBerry continues to sell handsets at below cost and cannot reverse the decline in service revenues and users, investors have no reason to buy the BlackBerry stock," Stuart Jeffrey, analyst Stuart Jeffrey Nomura, said November 4. "Without the sale of smartphones, the BlackBerry will not be able to access new users and will not be able to earn new services." BlackBerry services earned 724 million dollars in the last quarter, accounting for 46% of total revenue. Even so, BlackBerry can still rely on existing users for service income. The number of BlackBerry users in June was reduced from 76 million in March to 72 million. After that, the BlackBerry did not advertise the number of users. The best choice Doradala said, thoughClosing smartphones can cost money, but focusing on the software business helps BlackBerry restore profitability and growth. That means the BlackBerry will close its revenue of $6.65 billion trillion, which accounts for 60% of its revenue, and its BlackBerry software and services business revenues are 261 million dollars and 391 million dollars respectively. "Shutting down the hardware business is the best option," Doradala said, in the BlackBerry's possible choice. One thing is for sure, that BlackBerry should not retain its hardware business. Asked in an interview on November 4 whether he would not close the smartphone business, Chen replied that he could not rule out any possibility at the moment. BlackBerry spokeswoman Adam Emery Adam Emery declined to comment on how the company handled the handset business. The reason why Chen was chosen by the BlackBerry is that he successfully revived Sybase. Chen in 1998 when Sybase, Sybase is downsizing, the stock price near the lowest level of history. Chen sold Sybase to SAP in 2010 at 5.8 billion dollars, more than 6 times times as soon as he joined Sybase. Gold standard When asked what is the most noteworthy BlackBerry business, Chen mentions software and security services, including corporate mobile device management software, cryptographic software for government customers, patents, and BBM Instant messaging. Ramon Llamas, an analyst at IDC, said in a telephone interview, "Device Management is a big business opportunity for BlackBerrys, and Chen must seriously consider these Lamon Lamasse." The BlackBerry's security feature is the gold standard, and Chen can focus on developing this business and connecting it to the device management business. "BlackBerry faces MobileIron and Marvell in the field of mobile security technology," he said. Customers of the Marvell include Vodafone, AstraZeneca (AstraZeneca), USAF and U.S. Department of Homeland Security. Difficult task Jefferies analyst Peter Missec Peter Misek in a telephone interview, said, "We believe that the software business is the most need to vigorously promote the most need to focus on the business." For BlackBerry, it is difficult to revive the hardware business. Chen face a difficult task. "The transition to software makers could lead to a rise in blackberry prices," he said. According to Bloomberg, the market value of the BlackBerry is equivalent to 89% of the next 12 months ' revenue, with a median of 3.3 times times the ratio of market value to revenue for software vendors with revenues above 100 million dollars. The company's bid to buy blackberries is only 0.17 times times the latter's revenue, at the bottom of a similar takeover deal by North American telecoms and technology companies. Alexander Peterc, an investment company Exane BNP Paribas analyst Alexander Petec, said Chen could opt to sell these assets if the BlackBerry's main asset revives, "BlackBerry's corporate email, mobile device management platform is attractive to potential buyers", From the present point of view, "BlackBerry hardware business value is zero".