Investors Hang Up on Blackberry

Blackberry third quarter revenue misses forecast as turnaround plan is in doubt.
3:53 | 12/19/14

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Transcript for Investors Hang Up on Blackberry
I'm Dan a couple of new York and as the financial markets causing a loss report Friday December 19. This is story stocks there the one time thought of choice for middle management types everywhere. Have been rebounding in 2014. With new CEO John Chen focusing more on services and business customers. Third quarter revenue dipped however signaling some more static ahead sort of explain what's going on Blackberry wanna bring in Jack Moore from the street Jack unfortunate that my Blackberry meant what in 2000 ninths. Oh. Don't have that right now but it does the fact this is that they actually beat out on profit but they missed revenue what happened. They in this revenue badly to an end in that was actually a little bit surprising they just in Selma phones enough devices. Vigorously came out with this on this phone on the passport that. Everyone thought as a very high average selling price everyone thought that. That was in a drive. It was gonna have a lot more volume there and that was gonna drive much higher sales but that it really sell enough of those and down ultimately. They sold a lot more. Higher margin older phones then lower margin new ones and then they also. Slash cap acts tremendously so they're pretty deaths cost manager and they prove that so. You know they had weak revenues stated their margins came minute that pretty incredible levels but. Still it's it's concerning about that top line. Right way exact as them the C code in judgment he's been highly obvious of the challenges that the company's been facing there what are some of the top theory. Yeah I'd say that right off the bat it's it's a little concerning that they're not selling their new phones and in that's what. They have the classic which is like basically like and I've found from Perrier Blackberry from 2009. But it's modified double the new features and they're trying to bring back their core customer there. And they just launch that recently in the mail Saadat passport which is like and I found six like a big found. And down. And if that in those aren't selling so far or at least the passport that we've seen and that's concerning a mean that's gonna they need that terrifically drive revenue and they're gonna need revenue if they really want to. Drive real profitability. And then also the next concern is that. They have this software. System the software platform that a lot of enterprise customers are using for free right now. There they're beta testing at and then in January there that did that free trials gonna expire and the customers either convert they either pay or they leave and so I think that's a big concern and and it didn't look. It the CEO is just been very honest at this point that they tried again the consumer market and that's not happening I mean they've really got attacked the enterprise side and really good regain some stability there. Well so investors were first attracted to the fact that the company may be making a turnaround maybe rebounding. I they still there are faithful or are they starting to kind of question that decision. Yeah I mean if you're bullish on this I don't think this quarter race here position or raised here bullish thesis that this court it was kind of a holding pattern for them. Wasn't a time in news that came out in and those two phones that launched it. Pretty good there wasn't much contribution this quarter so you can say like look they're gonna have huge holiday sales not if your boss on that and then also there when I spoke to. Before that is seeing what the renewal rate of what the conversion radar on this six point nine million enterprise users that are. Using their software. For the free trial back comes January 31 will be. The very revealing and I think that. That will be and the bulls believe that that's gonna have a high conversion rate the bears believe it's gonna have a low one and I think that'll be really. The tipping point. We and we shall witness that laugh Jack Moore from the street Jack thanks so much appreciate it have a good weekend. It's. You've been watching story stock stay with for latest headlines I'm down that's where New York.

This transcript has been automatically generated and may not be 100% accurate.

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