{"id":25728,"date":"2017-04-01T09:55:09","date_gmt":"2017-04-01T09:55:09","guid":{"rendered":"http:\/\/www.biphoo.com\/bipnews\/?p=25728"},"modified":"2017-04-01T09:55:09","modified_gmt":"2017-04-01T09:55:09","slug":"blackberry-profit-beats-expectations-software-push","status":"publish","type":"post","link":"https:\/\/www.biphoo.com\/bipnews\/technology\/blackberry-profit-beats-expectations-software-push.html","title":{"rendered":"BlackBerry\u00a0profit beats expectations on software push"},"content":{"rendered":"

\n\tBlackBerry profit beats expectations on software push<\/span><\/span><\/strong><\/span>
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\n\tBlackBerry profit beats expectations on software push:- BlackBerry Ltd reported better-than-expected adjusted earnings for the sixth straight quarter, as the smartphone pioneer's shift to the higher-margin software business paid off.<\/span><\/span><\/span>\n<\/p>\n

\n\tThe Canadian firm also said on Friday it expects to be profitable on an adjusted basis for the second year in a row, and generate positive free cash flow in the year ending February 2018.<\/span><\/span><\/span>\n<\/p>\n

\n\tThe company's U.S. shares closed up 11.5 percent at $7.75 on Friday, and its Toronto-listed shares closed up 11 percent at C$10.30.<\/span><\/span><\/span>\n<\/p>\n

\n\tWaterloo, Ontario-based BlackBerry has focused on building a robust software business after scrapping production of its once-iconic smartphones, which lost favor with the arrival of sleek and fully touchscreen handsets.<\/span><\/span><\/span>\n<\/p>\n

\n\tThe company outsourced the development of its smartphones last year, signing a deal with Indonesia's BB Merah Putih to make and distribute new BlackBerry-branded devices. It has also signed similar deals with China's TCL and India-based Optiemus Infracom Ltd.<\/span><\/span><\/span>\n<\/p>\n

\n\tAdjusted revenue from the software and services unit, which includes mobile device management products and the QNX industrial operating system, rose 12.2 percent to $193 million in the fourth quarter ended Feb. 28, from the preceding quarter.<\/span><\/span><\/span>\n<\/p>\n

\n\tQNX is crucial to BlackBerry's efforts in the self-driving vehicle industry. The company already has a partnership with Ford Motor Co to develop autonomous driving software, and Chief Executive John Chen hopes to forge such deals with carmakers around the world.<\/span><\/span><\/span>\n<\/p>\n

\n\tOn an adjusted basis, the company's total revenue was $297 million, beating analysts' average estimate of $289.3 million.<\/span><\/span><\/span>\n<\/p>\n

\n\t"They (Blackberry) put up a good quarter on the software revenue side, but if you dig a little deeper a lot of that beat was driven by relatively lumpy professional services revenue," Cavan Yie, portfolio manager at Manulife Asset Management, told Reuters.<\/span><\/span><\/span>\n<\/p>\n

\n\tYie said Manulife has stayed away from the stock due to Blackberry's lack of free cash-flow generation, but that could change given the "potential for good things to come out" of the software business.<\/span><\/span><\/span>\n<\/p>\n

\n\tGross margin jumped to 60.1 percent in the quarter from 43.3 percent last year.<\/span><\/span><\/span>\n<\/p>\n

\n\tBlackBerry received more than 3,500 enterprise customer orders in the quarter, a 16.7 percent increase from the third quarter.<\/span><\/span><\/span>\n<\/p>\n

\n\t"Looking ahead to fiscal 2018, we expect to grow at or above the overall market in our software business," Chen said in a statement.<\/span><\/span><\/span>\n<\/p>\n

\n\tExcluding one-time items, the company earned 4 cents per share. Analysts on average had expected the company to break even, according to Thomson Reuters I\/B\/E\/S.<\/span><\/span><\/span>\n<\/p>\n

\n\tOperating expenses nearly halved to $229 million.<\/span><\/span><\/span><\/p>\n

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