BlackBerry reports it's first BlackBerry 10 results and the trend suggests signs of recovery

BlackBerry posted a profit in the fourth quarter of $94 million US or 18 cents per share for quarter ended March 2. That's a turnaround from the recent trend-- during the same period a year ago, BlackBerry lost $125 million US or 24 cents per share.

Sales figures for the new BlackBerry smartphone have been a mystery since the device launched nearly two months ago and the day finally came for real data.

BlackBerry sold about one million BlackBerry 10 devices and includes devices sent to retail outlets that landed in customers hands, or also have yet to be sold.

The data suggests BlackBerry is on a path to recovery. Revenue increased to $2.68 billion, coming in below expectations of $2.84 billion.

Preliminary Numbers Do Not Constitute a Trend

The numbers are going to be preliminary and it is really too early to know if BB10 is a big success. Another quarter of data is needed before a clear trend can be seen. The pent-up demand by die-hard BlackBerry may have resulted in a surge in sales followed by a slowdown and iOS and Android users have no reason to switch devices. The Samsung Galaxy S4 will definitely keep Android users very satisfied as Samsung beefs up security with it's SAFE technology.

Since BlackBerry's quarterly report, the company held a splashy launch in New York for its new phones, changed its name from to BlackBerry and rolled out the Z10 touchscreen smartphone in several key markets around the world.

The fourth-quarter results will serve as a good sense of how that initial rollout went, and what to expect this year.

Catching Up Does Not Mean Innovation

My biggest fear is that BlackBerry just caught up and now is about to be leapfrogged by Apple, Google, and Samsung who have been working on their next innovations over the last year. BlackBerry is in launch mode with fewer employees. This means that innovation may not be coming as quickly as BlackBerry needs to survive.

For example, the camera in the BlackBerry Z10 is just like any typical smartphone camera but now Samsung is launching a 3D camera technology in the Galaxy S4. Samsung Galaxy S4's new features are the dual camera mode; Group Play for sharing music, photos, and game with those around you; eye controlled Smart Pause; as well as the new Air features that lets you control the phone without physically touching the phone. BlackBerry will just be catching up with fewer apps in their app store.

Reports From The Retailers

In recent weeks, analysts have relied exclusively on contact with mobile phone retailers to determine whether the BlackBerry Z10 is selling. The anecdotal evidence has proven mixed at best, with some relaying that stores were sold out in the U.K., while others said they couldn't find signs that stock was depleted.

The are serious questions about the number of phones each store received, leading to further confusion over how to qualify a murky product launch that may have stocked some stores with as few as two or three devices.

The stories of selling out are a bit misleading because many U.K. stores reported they received limited numbers of handsets at launch which made it look as if they had sold out due to demand. In fact they may have sold out due to running out of a very small number of devices.

BlackBerry Relying on Canada and U.K. Reports Of Success

BlackBerry has positioned the Canadian and U.K. launches a success, noting that devices were sold but did not provide sales figures. We are not sure if it is marketing or reality at this point.

U.S. Launch Murky

Analysts will also look for comments from Heins on the U.S. launch. Several analysts have characterized it as lacklustre to moderately impressive, with some criticizing the lack of marketing dollars put behind the U.S. launch and poor placement in stores.

Goldman Sachs reduced in its expectations for the success for BlackBerry 10 in the U.S. to a 20 per cent probability from 30 per cent.

Subscriber Revenues Slipping

Nearly as important will be BlackBerry subscriber numbers, which analysts consider a revealing figure showing the popularity of the devices and a window into future revenue potential. The company receives monthly service revenue from each of its smartphone users.

In the third quarter, the company's subscriber base slipped by one million to 79 million from the previous quarter, and expectations have been for a further erosion as more users get rid of their older BlackBerry models over the holiday season.

The New Q10- Physical Keyboard BlackBerry 10 Device

The company will release a version with a physical keyboard, which could attract longtime BlackBerry users who shy away from touchscreen devices. A release date hasn't been announced yet, though Canadians are likely to get the phone in April.

How Much Cash Is Left

A central question is just much cash the company does BlackBerry have after paying for the phone launch and related marketing expenses. BlackBerry has managed to keep a solid cash position of nearly $3 billion over the past year as it prepared BlackBerry 10.

Next Steps for BlackBerry

The focus on Thursday's quarterly report will be where the company is going. Is BlackBerry on a road to recovery or on a path to decline and ultimately being sold either in pieces or as a whole.

The next quarter will show a full quarter of BlackBerry 10 sales. Analysts believe that they have to wait one more quarter to see a solid trend one way or the other.