Blackberry Loses its No. 3 Slot but Still Has Reason to Smile

Reasonably upbeat initial results for the BB10 OS, even though overall market share is slipping.

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The latest Q1 2013 smartphone shipment numbers just came out from IDC, and they show that Microsoft‘s Windows Phone OS has officially taken the No. 3 smartphone OS spot away from BlackBerry (TSX:BB). It may seem that investors can declare BlackBerry the loser this past quarter, but in reality, they shouldn’t be so quick to judge.

The fight for No. 3
According to IDC, Windows Phone OS saw the most year-over-year growth this past quarter compared to any other OS, doubling its share from a year ago. Windows couldn’t have done this without its partner in crime, Nokia, which released the operating system into markets it hadn’t been in before and is responsible for 79% of all Windows Phone shipments.

Despite the good news for Nokia and Microsoft, BlackBerry has some numbers investors should be excited about as well. The company shipped more than 1 million units of its new BB10 OS in the Q1 2013 — the first quarter it is was available. Investors can’t overlook that the company experienced a 35% decline in shipment volumes from a year ago, but they need to keep in mind that the company made a significant pivot away from its older devices and operating system during this time. The more than 1 million shipments of BlackBerry’s new OS should be a glimmer of hope that the company could make the OS into a viable mobile option for consumers.

The real fight
Although BlackBerry and Windows Phone have been battling for No. 3, the real focus for the two operating systems should be on how to gain more market share from iOS and Android, and not just from each other. It’s an uphill battle to be sure, and with a likely refresh of iOS coming this summer or early fall, the two have a lot of work ahead of them.

Blackberry shares have been heavily shorted by those who believe the erosion of this company’s market share is still in the early innings.  We have created a special FREE report that identifies 3 U.S. businesses that are so dominant, no short-seller in their right mind should ever think of touching them.  Simply click here to receive “3 U.S. Stocks Every Canadian Should Own” – FREE!

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Fool contributor Iain Butler does not own shares in any of the companies mentioned in this report at this time.  David Gardner owns shares of Apple. 

The original version of this post, authored by Chris Neiger, appeared on Fool.com

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

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