In a surprising turn of events, Blackberry stock prices soared following the announcement that the U.S. Department of Defense will be purchasing a large quantity of Blackberry smartphones for those who are working for one of the department's networks by the end of January.
In recent years, Blackberry has been struggling to keep its mobile business afloat. In 2013, Blackberry stocks went down by around 36 percent after a succession of problems that the company found difficult to address. Before the year closed however, Blackberry stock prices went up around mid to late December. On Friday, Jan. 17, BlackBerry shares jumped 6.07 percent to close up at $9.08 on the Nasdaq. On Tuesday, Jan. 21, the shares rose again to close up 9.36 percent at $9.93.
The Department of Defense said it will be purchasing an estimated 80,000 Blackberry smartphones for the department's management system before the month ends. Along with this large order of Blackberry handsets, the department will also be purchasing around 1,800 iOS and Android tablets and smartphones. The deal was made public through an announcement by the Defense Information Systems Agency (DISA).
Due to the sensitive nature of Department of Defense operations, the department has stringent security requirements that manufacturers must meet. The highly secure Blackberry smartphone offerings seem like an obvious choice for an organization that handles both global and national security issues on a daily basis. Aside from being known for making secure devices, Blackberry also has solid reputation for releasing smartphones that are built to last.
BlackBerry was originally a powerhouse in the smartphone industry but aggressive and innovative encroachments by rivals such as Apple and Samsung have whittled away at the company's market shares. However, the company has also been proud of the security of its software and hardware offerings and this is something that companies like Apple and Samsung are still having trouble emulating.
Earlier this month, BlackBerry's new CEO John Chen said he expects the company to rebound around its core enterprise and defense customers. The company has also shed its flab with several top executives departing and being replaced by Chen's hand-picked men. The new CEO aims to have a positive cash flow by 2016.
