These are stories Report on Business is following Wednesday, Sept. 24, 2014.
Follow Michael Babad and The Globe's Business Briefing on Twitter.
Awaiting Passport
BlackBerry doesn't want to be an iPhone.
And with that in mind, watch as chief executive officer John Chen aims at BlackBerry Ltd.'s traditional customer base with the launch today of the new Passport.
One might say the new gadget is square – it actually is – rather than iPhone-hip as Mr. Chen unveils the professional-minded device in Toronto, Dubai and London.
"A new handset announcement this week would be the first significant product launch for BlackBerry since it introduced BlackBerry 10 devices in early 2013," said analyst Colin Cieszynski of CMC Markets.
"The launch at that time was a make or break one for the company and in the end, it broke," he said in a report.
The BlackBerry Z10, of course, launched under the previous chief, wanted to be an iPhone.
"BlackBerry's attempt to try and catch up in the consumer market was an epic fail that led to major writedowns of billions of dollars in unsold merchandise, massive layoffs, management upheaval and the company being put up for sale, which could have led to a break-up," said Mr. Cieszynski, nicely summing up what has been a horrendous period for the Canadian smartphone maker.
Mr. Chen will be front and centre today in Apple's shadow, given the record launch of its new iPhone 6 and iPhone 6 Plus.
Among what we know so far about the new Passport:
- Unlike most smartphones, the screen is square, 4.5 inches, 1,440 by 1,440 pixels.
- The screen displays 60 characters across.
- BlackBerry is pricing the device below that of the new iPhone and the Samsung Galaxy S5, at $599 (U.S.) in the United States, though we don’t know the cost in other countries.
- Based on the pictures, it has just three rows of keys, unlike the Q10’s four rows. There appear to be no numbers.
- It will come with the Amazon Appstore already installed
- The battery will be good for 36 hours.
Today's launch will be followed by BlackBerry's quarterly report on Friday, when investors will be scouring the document for more evidence of Mr. Chen's turnaround, now that his cuts have been made and he has two acquisitions in his pocket.
"Near-term, we expect a successful Passport launch could boost profitability, which would make it possible for BBRY to approach its 'cash flow break-even' target next Q (one quarter early) and potentially sets BBRY shares up for a trade," said Raymond James analyst Steven Li, referring to the company by its stock symbol.
As The Globe and Mail's Omar El Akkad reports, analysts expect the company to report second-quarter sales of between $900-million and $940-million, and a per-loss in the area of 16 cents.
As Mr. Cieszynski sees it, you'd think BlackBerry is poised to report good news given that the two events are in the same week.
"Scheduling a corporate event and an earnings report in the same week only makes sense if management expects to deliver good news on both fronts so that they can reinforce each other and show customers and investors that BlackBerry has turned the corner and is on the move again," said the CMC analyst, who projects an adjusted loss of 15 cents a share.
"In the wake of BlackBerry's many disappointments over the last several years, it's important for management to show things are getting back on track not only internally but relative to the competition as well," he added.
Analyst Todd Coupland of CIBC World Markets expects to see sales of $1.1-billion, a deeper-than-projected loss of 21 cents, and a jump in shipments to 2 million from 1.6 million in the first quarter.
"While we are not making any changes to our forecasts, BlackBerry's share price is likely to move up with [second-quarter] results as the upcoming launches of its new Passport and Classic products give it a reasonable chance to achieve cash flow break-even ahead of schedule," he said, adding he wants to know whether the bleed in services revenue is over.
Mr. Li of Raymond James also wondered about the "ongoing services decline."
In premarket action, BlackBerry shares were up 1.8 per cent within about 30 minutes of the Nasdaq open.
- Shane Dingman and Sean Silcoff: With Passport, BlackBerry bets on 'polarizing' device
- Omar El Akkad: BlackBerry's Passport launch a test of restructuring efforts
- David Berman in Inside the Market (for subscribers): BlackBerry battleground: Taking sides on its outlook
- Drop, dunk, slide: New iPhones not unbreakable, but hardiest yet
- Apple sells record 10 million new iPhones in fist three days
SEC probes Pimco
Pimco and its chief Bill Gross are the talk of the financial world this morning with news of a Securities and Exchange Commission probe into its Total Return exchange-traded fund.
Both the company, the biggest bond manager in the world, and its parent Allianz reportedly confirmed the investigation into the pricing of the fund.
Pimco said it is co-operating with the U.S. regulator, and that "we believe our pricing procedures are entirely appropriate and in keeping with industry best-practices."
Markets mixed
Stock investors are largely treading water so far this morning, with global markets mixed and looking up.
Tokyo's Nikkei lost 0.4 per cent, while Hong Kong's Hang Seng eked out a gain of 0.4 per cent.
In Europe, London's FTSE 100, Germany's DAX and the Paris CAC 40 were up by between 0.1 per cent 0.6 per cent by about 8 :45 a.m. ET.
New York futures were also up.
"Having declined the first two days this week, U.S. markets look to be stabilizing with a mixed open today buoyed by a strong performance in Asian markets but tempered by the possibilities of further housing data weakness," said analyst Jasper Lawler of CMC Markets in London.
"Stocks have had a setback this week as sentiment soured over economic progress in Europe and China with monetary policy from the respective central banks deemed by many in the market to not be going far enough," he added.
'Indoor agriculture'
There's an interesting deal announcement this morning that you've got to read in two parts to get the full flavour.
Part 1: "Calyx Bio-Ventures Inc. … is pleased to announce it has entered into definitive agreements to acquire Cannigistics Agri-Solutions Corp. ('Cannigistics'), a company focused on bringing sophisticated versatile, and flexible technology solutions to advanced indoor agriculture."
Part 2: "Cannigistics is presently designing an enterprise software platform tailored to the medical marijuana industry."
Streetwise (for subscribers)
Real estate
ROB Insight (for subscribers)
Business ticker