BlackBerry recently unveiled its new smartphone, the Leap, and also announced three more devices lined up for 2015. However, Cowen and Company analyst Brian Prohn believes the Canadian firm still has a long way to go to turn itself into a sustainable business. The Cowen analyst has a Market Perform rating on BlackBerry with a price target of $10 per share.

BlackBerry Ltd More Than Halfway Through Its Transition: Cowen

BlackBerry halfway through its transition

At a recent media event, BlackBerry showcased its Leap smartphone, but the analyst believes the hardware will play only a small role in the future of the company. BlackBerry is more than half-way through its long-term transition from being a hardware-centric business to a “software-centric, cross-platform enterprise mobility management and security play,” according to Prohn.

Even though the Canadian firm has already made an impressive move toward being a software firm, hardware still and will continue to dominate the business in the near term. According to Prohn, a major part of software revenue is still a few quarters away, and until that time, devices such as the Leap will make up about 45% of BlackBerry’s total revenue.

Leap to replace Z3

The BlackBerry Leap is different from the company’s other recent offerings, in which it has focused more on its traditional physical keyboard. The Leap is a 5-inch all-touchscreen device with an 8MP camera, 25-hour battery life and the company’s state-of-art security system. The upcoming device will be available in a few emerging and developing markets beginning next month for $275, and according to the Canadian firm, it will appeal to mobile enterprise users seeking productivity and security in a smartphone.

Analysts expect the Leap to replace the Z3 in the market. Therefore, if the device is able to surpass the Z3’s 3.5 million to 4 million in annual sales, then the Leap could be considered a success.

Along with the Leap, BlackBerry also announced plans to launch three more devices in 2015, “including: 1) a new premium tier Porsche model, 2) another new physical keyboard model and 3) a dual-curved edge (think Samsung Galaxy S6 edge) all-touchscreen model that includes a slide-out physical keyboard.” Even though not much is known about those devices, Prohn expects hardware revenue to rise 45% year over year.

In pre-market trading today, BlackBerry stock was down by over 4% at $10.23.