BlackBerry could ditch its operating system to release phones on Android, according to RBC Capital’s Mark Sue. While the company is highly focused on growing its software sales, an Android device could help the Canadian firm reduce the huge fixed costs required to maintain its own operating system, noted Sue.

BlackBerry Could Ditch Its OS For Android: Analyst

Will BlackBerry hit its software sales target?

Sue assigned a Sector Perform rating to BlackBerry, suggesting that upcoming BlackBerry devices will be a “customized security-focused” version of Android running on BlackBerry hardware.

However, Sue and other analysts are more concerned about BlackBerry’s recent software sales when it reports first quarter results on June 23. On average, analysts are estimating the company’s loss to come in at 3 cents per share on total revenue of $698 million.

Sue said that a potential Android device and the recent reorganization indicates the shifting focus to software. BlackBerry is hoping software sales for the current year will come in at $600 million. However, Sue termed the outlook as “back-end loaded” and expects first quarter sales in the category to be sequentially flat at around $70 million.

Analyst Tim Long at BMO said that $600 million in software sales is an ambitious goal from BlackBerry as the company will have to post around $84 million in the first quarter to show “a solid trajectory” toward achieving $600 million.

Also Morgan Stanley analyst James Faucette feels that achieving the said number by the Canadian company “remains in question.”

Hardware days numbered for BlackBerry?

Faucette noted that the bleak popularity of the new devices could affect the company across the board. Faucette assigned an Underweight rating to the firm with a price target of $7 per share. The analyst expects device sales to fall sequentially to around 1 million units in the first quarter. Citing a survey conducted by Morgan Stanley, Faucette said that corporations are looking to favor BlackBerry’s competitors.

Richard Tse, a Cormark analyst, said that hardware will soon become a non-factor for BlackBerry. Tse believes adjusted earnings per share for the Canadian company will come in flat on revenue of $269 million, compared to the consensus of adjusted losses per share of 3 cents on revenue of $698 million.

However, ScotiaBank analyst John MaGee differs from the lot. MaGee is hoping more positive trends will emerge in the second quarter.

“We continue to recommend that long-term investors take a look at the name” said MaGee.