BlackBerry, Nokia: Recovering or collapsing? By the numbers

BlackBerry, Nokia: Recovering or collapsing? By the numbers

Summary: Nine months on, the two former phone and smartphone behemoths are still holding on to the smartphone cliff, hoping not to fall into the mobile market tar pits. What's changed, and can the two still survive? From what we've seen, only one company can—but not because of the other.

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TOPICS: BlackBerry, Nokia
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I was optimistic for a time. (Yes, it happens. Rarely.)

As a kid growing up, I used a Nokia, as did practically everyone else. Kids, adults and business folk alike all used a Nokia for some time during the mid-to-late '90s. And then the BlackBerry craze began during the mid-to-late 2000s, and I, like every other teenager, student and Generation Y'er during the latter part of the decade, owned one. 

And then Apple and Google came along and stamped on the market with a range of revolutionary touch-screen phones. Progression is progression, and we can't begrudge the iPhone and Android makers for advancing the stale and stunted state of the mobile market. 

Since then, the two companies have faced almost certain demise, either at one time or another or even multiple times. Three fiscal quarters later since global media 'death watch', deals made between companies, product delays and eventual launches later—little has actually changed on the face of it.

And seemingly arbitrarily, nine months later—or specifically, 276 days—since we last looked at the two companies' numbers in tandem, we thought it might be worth taking another look at the two companies to see if—just if—the two can continue to hold on to the edge of the smartphone cliff for a little while longer.

And it's not all good news, folks. 

Market share

BlackBerry (formerly RIM) held a 6.7 percent sales share for the whole of the first-quarter of 2012, down by 29.7 percent year over year, according to IDC figures. Meanwhile, comScore said BlackBerry had a platform share of 12.3 percent, declining by 3.7 percentage points over a three-month period.

Nokia had an 8.2 percent sales share of the smartphone for the first-quarter of 2012 according to IDC, but this was down by more than 50 percent year over year. That said, the feature phone market was still booming for Nokia, holding a 20.8 percent share in second place behind Samsung, which had 23.5 percent. Nokia's feature phone share was still falling by 23 percent year over year, however.

Nine months later, BlackBerry has been relegated to the "others" section in IDC's latest fourth-quarter of 2012 figures, as was Nokia. Figures weren't broken down but both pegged below the 4.3 percent market share figure, where fifth-place Huawei currently stands.

Both BlackBerry and Nokia's market share have declined—in both smartphone and feature phone categories—despite aggressive pushes to the developing and emerging markets, notably Indonesia for BlackBerry, and Africa and China for Nokia. 

Nokia retained its second place hold on the feature phone segment, but declined by 23.9 percent year over year, with just 17.9 percent of the market.

Both have lost significant market and platform share, but Nokia is still holding on desperately to its feature phone foot-hold. Yet, this will come back to haunt Nokia as its smartphone segment remains all but non-existant, and it will no longer develop cheap-to-build Symbian-based devices. It looks like—at least on the face of it—that Nokia is ramping up its already-slow smartphone effort while ditching its declining yet still lucrative feature phone unit.

BlackBerry, meanwhile, has seen its "best performance" for the first week of sales but did not share sales figures. Numerous retailers speaking to ZDNet—including U.K. cell network O2 and phone retailer Phones4U—confirmed that their stock had to be replenished, reaffirming BlackBerry chief executive Thorsten Heins' comments that sales are on the whole good.

Sales figures

Nine months on, sales are still not where they should be, at least for two companies clinging on for dear life and trying to revitalize general interest in their products and services.

For BlackBerry, the numbers are quite simple. Quarter on quarter, BlackBerry is shipping fewer devices. In Q4, the company shipped 11.1 million smartphones and lost two executives. In Q1, it shipped 7.8 million smartphones. In Q2, the firm touted 80 million subscribers worldwide, but only shipped 7.4 million smartphones during the quarter. And in Q3, BlackBerry shipped only 6.9 million smartphones.

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The pattern is clear: BlackBerry smartphone shipments are going down significantly quarter-on-quarter.

BlackBerry has cumulatively shipped, in the nearly two years the device has been on sale, around 1.49 million PlayBook tablets. By comparison, even in Apple's worst iPad selling quarter—the third quarter of 2010—the Cupertino, Calif.-based company sold double that with 3.27 million iPads. And that's just in one quarter alone, and the first quarter the iPad was on sale, where nobody knew if they should buy one or not.

Nokia is a tale of two fronts: a smartphone unit—which includes the Windows Phone-powered Lumia range, but is not limited to it—and a feature phone unit, that is slowly being wound down. 

Nokia sold 4.4 million Lumia smartphones during the fourth-quarter of 2012, at the last earnings report. Compare this to previous quarters and Lumia sales figures remain stagnant at best. Nokia sold 4 million Lumia smartphones during the second-quarter of 2012, and a meager 2.9 million Lumia smartphones during the third-quarter

What's likely going to happen is that Lumia and other 'smart device' sales will remain flat or slightly above or below by a few percent quarter-on-quarter, while at the same time feature phones that sit close to smartphone 'status' will continue to dwindle, particularly in emerging markets.

By comparison, according to Strategy Analytics, Samsung sold 55 million smartphones during its third quarter. Apple sold 26.9 million iPhones during its fourth quarter

Single figures just aren't going to cut it.

Share price

Share price and market caps are not the best indicator of how much a company is 'worth,' per se, but it's nonetheless gives an idea of how investors, shareholders and Wall Street feels about a company's state of affairs.

Nokia ($NOKwent from a pre-global recession share price high of $39.71 in November 2007 to a record low of $1.71 in July 2012, representing a massive 95.6 percent drop in price in just five years. Not only did the global recession kick ten bells out of the Finnish phone maker, it failed to innovate in the then-developing smartphone market.

z-NOK-price-marketcap-1yr
$NOK. Red line represents nine-month ago mark (Credit: YCharts)

Nokia's market cap has recovered marginally from its record low point in 2012 and gained back mostly what it lost during the last nine months. Nokia is roughly valued at about $15.34 billion based on its current market cap.

Meanwhile, BlackBerry ($RIMMwhich now trades as $BBRY) went from a post-millennium share price high of $144 in June 2008 to a record low of $6.47 in September 2012, representing a 95 percent drop in price. 

2-rimm-price-marketcap-1yr
$RIMM (now $BBRY) Red line represents nine-month ago mark (Credit: YCharts)

BlackBerry's market cap has recovered the most from its record low price of $11.82 in September 2012 and surpassed the price it dipped to nine months ago to about $16.80—a 42 percent increase in just three fiscal quarters. BlackBerry is roughly valued at about $8.41 billion based on its current market cap. 

Page 2: Profit margins, cash, and concluding thoughts -->

Topics: BlackBerry, Nokia

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69 comments
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  • We Need Ted Striker

    Shouts Nokia and RIM board.
    Alan Smithie
    • We need math. 2.9M in Q3, 4.4M in Q4. Zack calls it stagnant??

      That despite not being available on Verizon and Sprint and worldwide supply shortages.
      Johnny Vegas
      • Well

        A lot of people are short term thinkers. They don't see bigger pictures, they don't realize that these industries are not sprints, they are marathons. They also lose track of history: 15 years ago, Apple was on its knees, begging for money. If not for a few angel investors, which included Microsoft, dropping a few hundred million to save the company and put Steve Jobs back in charge, there wouldn't *be* an Apple Computer today. There wouldn't *be* an iPhone or iPad.

        Personally, I moved away from iPhone 2 years ago, and have recently upgraded to a Nokia Lumia 920. Between the device's quality and the fantastic OS, there's no chance I'll ever go back to Apple where phones are concerned. I sold my iPad just before they announced they were abandoning support for it 18 months after launch (I just had a feeling they were going to do that), though I may snag an iPad 3 or 4 at some point just for work purposes, but the computer that will replace my Macbook Pro is a Microsoft Surface Pro. Probably not this first version coming out Saturday (though my fiancee, a professional illustrator, is getting one for sure, because it's simply the best artist computer available when you consider the 1024 levels of pressure sensitivity in the screen, the power and portability, and its ability to use high end art apps), I may wait for the Pro 2 which I'm sure will be announced and released in a year or less, but barring some unforeseen innovation, that's the way it's going.

        Anyway, I digress a bit, but the point remains: this industry doesn't run on overnight turnarounds, it takes years to rebuild a business once it's made bad choices and fallen on hard times. Just look at Apple: it took them almost going out of business to finally smarten up. Look also at Microsoft: it took the catastrophe of Windows Vista to make them totally rethink their OS strategy, and now they've got fantastic, fresh, innovative OS's that bring new paradigms to computing.

        Let's just relax and watch. This'll be fun :)
        jasongw
        • Agree

          jasongw - You are the one who should have written this article. Awesome, intelligent reply! Apple and Google do not have a monopoly on great ideas and design.
          Hard Logic
        • I disagree

          Not totally, but in many ways.
          Apple turn things almost overnight and android followed next.
          It's true they were lagging behind for centuries until they came up with the next great and brilliant idea.
          Microsoft can keep trying, maybe they can make it next year, in five or in twenty, ... but so far there is no signs that they are near to become relevant in mobile.
          If it's hard to have great ideas is also hard to fight dominant players. Microsoft could taste the same faith of competitors in desktops pc's, where Microsoft is absolute dominant - I'm not going to say what is best, but I'm sure nobody believes that windows is like 10000 times better than OS2, linux, ....
          AleMartin
          • An anecdote does not an argument make . . .

            But still, I ducked into the Microsoft store in Plaza Las Americas today, which is the largest mall in the Caribbean, and it was absolutely crammed with people checking out the Surface Pro. I asked the saleslady how they were selling and she said that the only ones they still had in stock were the 64GB model - and few at that. I asked her how many of the other kind they had in stock to begin with, and she told me 300. Now, you're talking about a Microsoft store on an island with a 68% unemployment rate and an average income of $15,000 - half of the poorest US state. Yet the Surface Pro is selling out in Puerto Rico. Explain that to me, please, if no one wants it.
            FishyLuvSite
          • They will sell many

            Compared with iPad very few.
            I always said that surface as a traditional pc will sell a lot. But it will not place Microsoft relevant in mobile devices.
            I've an estimation, 500k for the first 3 months on sale.

            Anyway this is about smartphones...
            AleMartin
        • Remember

          We all must remember that people who love Nokia will likely stick with Nokia. And that is a regional likelihood.

          For those that are outside of the regions, Nokia will have to work hard by both selling excellent product and marketing it. Android? Excellent marketers, but lousy products, as you can see by the people that join that platform... and then leave in disgust with good looking but shoddy products.

          Nokia? They're our battleship, here to stay.
          StandardsMan
      • ZDNet is housepet of Apple

        The analyses of Zack Whittaker is biased beyond believe.

        The figures mentioned in his article are carefully selected to make a point in favor of Apple and against Nokia and to a lesser extend against Blackberry.

        Facts are:

        - Nokia made a profit last quarter (Q4/12),
        - Nokia has the most patents (+ 20.000) of all companies in the mobile tech sector.
        Nokia currently holds the second largest portfolio of US patents (15.987 and 4.453 pending), behind partner Microsoft. In addition. Nokia holds over 20,000 foreign patents and pending applications, with a majority of those being in Europe.
        - Nokia has more profitable entities besides Devices & Services (making phones). Nokia Siemens Networks adds about 48% to Nokia's revenu. "HERE" (formely known as Navteq) is another devision within Nokia which makes navigation in 4 out of 5 modern cars worldwide.
        Apple on the contrary, does not even come close to the mapping and location based services of Nokia's "HERE",
        - Nokia's Lumia 920 simply is much better than the iPhone5 in almost every aspect, besides the amount of unneccesary apps no one ever wanted or used for the last 5 years)
        - that share price is based on the huge profits they made in 2012, which are not likely be feasible in 2013 because of firm competition of .... Nokia
        - Nokia's share price is still based on near bankrupty levels, while Nokia clearly turned the corner last quarter, while Apple share price is based on 2012 record profits which definitly belong to the past, since Apple needs to cut its margins drastically to answer competition.

        It is clear Zack is promoting his declining Apple shares.
        Good Luck Zack!
        babbeloo
        • I"m glad i'm not alone in my feelings toward ZDNET.

          ZDNET has been gargling Apple's sac the last few years! I remain hopeful this will change because they used to be a quality tech site you could depend. There are very few ZDNET writers that actually write unbiased articles.
          Rob.sharp
      • We got math, just not very good

        Eg: "Apple keeps roughly 24 cents of revenue on every product it sells," Oops!
        paulhknight
        • Not quite 'oops!'

          Let me explain.

          In the piece, I mention profit margins. Here's what I say:

          "Nokia spends about 13 cents (on the dollar) on every device and product that it sells..."

          Then I say, after the graphic:

          "It's no surprise therefore that Apple keeps roughly 24 cents of revenue on every product it sells, while BlackBerry keeps about 3 cents."

          Now, granted there was a graphic in the way, and talking about numbers so enthusiastically might have swayed one's attention. Sure. However, you're right to infer that this should have been clarified in later statements -- even though at the time, I thought it was pretty clear when I wrote it.

          I've edited this to reiterate that I'm talking about X cents *on the dollar*, rather than cents overall. That would, of course be silly.
          zwhittaker
          • No explanation needed old man.

            Just pulling your chain on a boring saturday. I love your articles! Amusing being called "housepet of Apple" above, I recall you being accused of being in MS's pocket in the past... I suppose being accused of bias equally in all directions is about as close to fine as a journo can get in these bleedin' forums!
            paulhknight
          • Here's an interesting thought

            Everyone's biased. I am. I'll tell you this: I own a Nokia 5130 (actually it just stays on the side, I need a U.K. phone while I live in New York) -- and a BlackBerry 9790, which I just swapped for an iPhone 4S (don't ask...) and am production testing a BlackBerry Z10.

            So, where do my loyalties lie? Actually not a flippin' clue, but here's me in a nutshell: "I'm pretty grumpy about everything, but I try and be grumpy about everything equally."
            zwhittaker
      • Do the same math for q2 vs q4

        4M to 4.4M.
        Sales of q3 were an outlier, WP7 was just sentenced too be killed.
        AleMartin
        • Nobody/Nothing gets sentenced "TOO" be killed.

          And your prediction is simply rediculous.

          Lets chat in a couple years.

          You might be leading the "WTF happened???" pack.
          Cayble
          • My predictive keyboard can be as lousy as me

            We both do wrong predictions :)
            I would be happy to be in that group, not so much for Microsoft but for Nokia.

            Hope I'm still on time
            "to be..."
            AleMartin
          • If my comparison about quarters is ridiculous

            Why not guessing sales for 2013's q1? :P

            Many are in the bandwagon of those who believe the growth from q3 to q4 of 2012 was amazing and sign of incredible growth for future - not me.

            I start with my educated guess - in q1 of 2013 Nokia will sell between 3.5M and 4M Lumias (and I'm trying to be optimistic), so they will not grow from the previous quarter in my opinion.
            Are you brave enough? :)
            AleMartin
      • Re: We need math. 2.9M in Q3, 4.4M in Q4.

        And 4 million in Q2. If you think Q4 was great, then Q3 was terrible. So the net result (trying to be kind) was "stagnant".
        ldo17
  • Perception

    Both companies make excellent products now. Only perception is lacking.
    Sean Foley