BlackBerry’s comeback continues — gross sales and earnings high forecasts


Blackberry CEO: The smartphone market is saturated

BlackBerry’s transformation from struggling smartphone firm right into a burgeoning chief in cybersecurity software program and linked vehicles is on observe.

The corporate now generates greater than 90% of its whole income from software program and companies. And 81% of these gross sales are recurring. In different phrases, BlackBerry is now not topic to the fickle tastes of customers and has hitched its wagon to company clients.

BlackBerry (BB) reported earnings and gross sales Friday morning for its newest quarter that topped Wall Road’s forecasts. The inventory was up greater than 15% in late morning buying and selling on the information.

CEO John Chen, talking to CNN Friday, stated the corporate’s greatest successes this quarter had been within the linked and autonomous automobile market, with income development of about 30% for the enterprise unit that features the QNX software program enterprise for vehicles.

Chen stated BlackBerry is working laborious to win extra clients within the automotive market, pointing to a deal it introduced in January with Chinese language search engine big Baidu (BIDU) to collectively develop self-driving vehicles.

The corporate, underneath Chen, realized a couple of years in the past that it was a shedding battle making gadgets that generated razor-thin revenue margins at a time when Apple (AAPL) and Samsung (SSNLF) dominate the smartphone race.

That is why BlackBerry determined in 2016 to cease making its personal telephones and outsource the manufacturing of gadgets with the BlackBerry identify on them to different producers.

Since then, BlackBerry has gone all-in on software program.

BlackBerry hoping for a brand new ‘Spark’

So what’s subsequent? Chen stated he is hopeful that BlackBerry’s new Spark safety platform, which is form of like instantaneous messaging on steroids, could make a much bigger presence within the well being care market. Spark integrates video chat, texts and different types of media.

BlackBerry is concentrating on well being to assist the corporate increase past its core markets of transportation, governments and monetary companies corporations.

Buyers are happy with the turnaround too. BlackBerry’s inventory is up greater than 60% since Chen took over practically 5 years in the past. That is strong, however it has lagged the efficiency of Apple in addition to the Nasdaq.

Nonetheless, Chen has cleaned up BlackBerry’s stability sheet. The corporate now has $2.4 billion in money and simply $740 million in long-term debt. Rumors about BlackBerry going out of enterprise are now not operating rampant the best way they had been earlier than Chen joined.

BlackBerry’s board is pleased with Chen’s management as nicely. BlackBerry introduced in March that it was extending Chen’s contract by November 2023.

That will additionally put to relaxation a few of the rumors that Chen was solely going to stay round lengthy sufficient to promote BlackBerry to a bigger rival.

CNNMoney (New York) First revealed September 28, 2018: 10:41 AM ET



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