BlackBerry

BlackBerry tops estimates with its Q3 earnings report; shares soar

posted by Alan F.

@wolfcallsputs

Dec 18, 2015, 10:30 AM

BlackBerry tops estimates with its Q3 earnings report; shares soar

Even though BlackBerry reported today a 3 cents a share net loss for its third quarter, the results topped Wall Street expectations of a 14 cent a share loss. Additionally, revenue also topped estimates of $488.8 million. For the quarter, the company reported revenue of $557 million. During last year's third quarter, BlackBerry reported the slimmest of profits (1 cent per share) on revenue of $793 million.

Including the launch of the company's first Android phone during the period, handset sales totaled 700,000 units for the quarter. Numbers for the BlackBerry Priv slider were not broken out separately. That sales figure was lower than some Wall Streeters expected, and was down sequentially from the second quarter which was prior to the Priv's release. Hardware sales came to $222.8 million, down year-over-year, but up from the $201 million tallied during Q2.

Chen told investors and analysts that his first priority is breaking even on phone sales. He told analysts that this is coming soon. "Maybe next quarter, maybe a quarter later, but we’re in that ballpark now," said the executive. He added that there is a good chance that device sales start making money and that the company decides to keep the unit. During the same conference call, Chief Financial Officer James Yersh said that BlackBerry needs to sell 5 million handsets a year to make the business worth keeping.

Where BlackBerry showed a major improvement was in software and services. Revenue for that group amounted to $162 million for the three months, up 183% from last year, and 119% from the second quarter. Acquisitions helped in this category, especially the purchase of Good Technologies.

As usual, BlackBerry continued to have plenty of cash and easily converted investments socked away for a rainy day, with $2.3 billion on the books. However, that was down from the $2.89 billion it held as the 2014 fiscal year came to an end.

"I am pleased with our continued progress on BlackBerry’s strategic priorities, leading to 14 percent sequential growth in total revenue for Q3. We delivered accelerating growth in enterprise software and higher revenue across all of our areas of focus. Our new PRIV device has been well received since its launch in November, and we are expanding distribution to additional carriers around the world in the next several quarters...BlackBerry has a solid financial foundation, and we are executing well. To sustain our current direction, we are stepping up investments to drive continued software growth and the additional PRIV launches. I anticipate this will result in sequential revenue growth in our software, hardware and messaging businesses in the fourth quarter."-John Chen, CEO, BlackBerry

Investors loved the report. Shares of BlackBerry are up more than 10% on Friday to $8.64.

BlackBerry Priv

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source: FinancialPost, 24/7WallStreet

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30 Comments

1. Carlitos

Posts: 696; Member since: Oct 23, 2011

Great news honestly! !! Hoping to see blackberry back in the game!!! And with android along side it's going to be very interesting

posted on Dec 18, 2015, 10:32 AM 5

2. NoToFanboys

Posts: 3231; Member since: Oct 03, 2015

I wonder where are the idiots who said that the priv is another nail in BB's coffin.

posted on Dec 18, 2015, 10:37 AM 13

7. SamsungPhanboy

Posts: 765; Member since: Mar 31, 2015

They are too busy in their daily early morning circle jerk.

posted on Dec 18, 2015, 11:05 AM 4

27. Mxyzptlk unregistered

Well to be fair, some of the doubt was reasonable.

posted on Dec 18, 2015, 6:12 PM 0

12. jroc74

Posts: 6023; Member since: Dec 30, 2010

Or the ones that said Android isnt the answer to companies struggling selling phones. They may not be the answer....but they sure are a decent choice to at least try. Just to see what happens.

posted on Dec 18, 2015, 11:50 AM 1

19. noler

Posts: 326; Member since: Aug 19, 2013

Last quarter they sold 800,000 devices, this quarter they sold 700,000 devices. So Android is the answer?

posted on Dec 18, 2015, 1:52 PM 2

20. Rafishant

Posts: 411; Member since: Oct 13, 2015

I wonder how many Priv were sold?? Did you read the financial report? BlackBerry hardware is still falling and they merely sold 700K, which is extremely epic fail when you know the majority units of that tiny number are BB10. Yes, BlackBerry Priv would be the last handset from BlackBerry

posted on Dec 18, 2015, 1:59 PM 1

22. meanestgenius

Posts: 22817; Member since: May 28, 2014

BB10 handset sales were already falling, and the Priv sales have onl been counted for about 3 weeks. BB10 sales were also possibly canabalized as buyers waited to purchase the Priv. 700,000 handsets with very little initial carrier support and very little marketing isn't bad. Let's see next quarters sales when we have a full quarter of Priv sales plus more carrier support before trumpeting "doom and gloom". Plus, software is on the rise, which is exactly what Chen and Co. are pushing for since BlackBerry has transitioned to a SaaS company. Then again, "doom and gloom" is all you've been trumpeting concerning BlackBerry ever since you joined this site, so I'm not surprised. I wonder what FUD you'll trumpet next when they release their next handset after the Priv?

posted on Dec 18, 2015, 2:15 PM 2

25. Rafishant

Posts: 411; Member since: Oct 13, 2015

BlackBerry won't die! I never said otherwise. They have a very good software division and they must focus only on this. They don't have any chance in the handset division, and they can't lose money there forever.

posted on Dec 18, 2015, 3:41 PM 0

26. meanestgenius

Posts: 22817; Member since: May 28, 2014

Point out where I said that you said "BlackBerry will die". I'll wait.... They are focusing on their software division. It's primary now. Hardware is secondary. However, there are just too many government officials, agencies, and enterprises dependent on the security that BlackBerry provides, and that includes their handsets. As you can see, they are definitely moving in a positive direction. They won't lose money forever as their handset division will first break even, and then show growth. Have a little faith. Turnarounds like this don't happen overnight.

posted on Dec 18, 2015, 4:30 PM 2

21. Johnnokia

Posts: 1158; Member since: May 27, 2012

That is the problem. No numbers for the Priv selling rate. They sold only 700K handsets including the Priv. Still away from the target of 5 million handset in a year. I hope the wider distribution will improve it.

posted on Dec 18, 2015, 2:06 PM 1

23. meanestgenius

Posts: 22817; Member since: May 28, 2014

ASP's were up for the quarter, which is undoubtedly due to Priv sales. With more carrier partners coming along, which will equate to wider distribution, we should get a better picture of what's going on with their hardware division, assuming Priv sales will also cover falling BB10 sales.

posted on Dec 18, 2015, 2:24 PM 2

3. Commentator

Posts: 3723; Member since: Aug 16, 2011

Neat! Hope that stock keeps soaring!

posted on Dec 18, 2015, 10:48 AM 0

4. CLA250

Posts: 1; Member since: Dec 18, 2015

Blackberry could have posted higher revenue, if they nor Verizon dragged their feet in releasing the phone. But, hey it is good news for the company. Maybe Verizon will finally release the phone.

posted on Dec 18, 2015, 10:56 AM 0

6. BobbyDigital

Posts: 2125; Member since: May 29, 2014

At&t has a temporary exlusive. That's why Verizon hasn't released it yet.

posted on Dec 18, 2015, 11:00 AM 0

10. meanestgenius

Posts: 22817; Member since: May 28, 2014

Hopefully next year will also have T-Mobile and Sprint carrying the Priv, as well as Verizon.

posted on Dec 18, 2015, 11:22 AM 1

13. Hexa-core

Posts: 2131; Member since: Aug 11, 2015

Unless those carriers wouldn't cripple the Priv's quick update policy, then yeah!

posted on Dec 18, 2015, 11:51 AM 0

15. meanestgenius

Posts: 22817; Member since: May 28, 2014

I hope that doesn't happen. It would really suck if the carriers did do that.

posted on Dec 18, 2015, 12:04 PM 0

16. Hexa-core

Posts: 2131; Member since: Aug 11, 2015

It's inevitable. Verizon began rolling Marshmallow for the Nexus 6 just last week!

posted on Dec 18, 2015, 12:41 PM 0

17. meanestgenius

Posts: 22817; Member since: May 28, 2014

You know, you're right about that. While more carrier partners is a definite plus, it sucks that carriers can stifle updates. It's best to buy the Priv unlocked, therefore you can get the updates straight from BlackBerry, bypassing carriers.

posted on Dec 18, 2015, 1:48 PM 0

5. BobbyDigital

Posts: 2125; Member since: May 29, 2014

Great news BlackBerry! Now I'm just patiently awaiting the trolls who'll come here with the same "doom and gloom" story they spit out every quarter and every quarter they're proven wrong. BlackBerry is still here. Hopefully, the trolls won't be.

posted on Dec 18, 2015, 10:59 AM 3

11. carlemillward unregistered

Their next phone can only be better, now they can iron out all the problems they faced with the Priv.

posted on Dec 18, 2015, 11:24 AM 0

8. meanestgenius

Posts: 22817; Member since: May 28, 2014

Great news indeed! BlackBerry, while still in the midst of their turnaround, is definitely trending in the right direction. Software is up. The stock is up. And even though handsets only came in at 700,000, I think that's rather good if you factor in that only a few weeks of Priv sales have been recorded, and that BB10 sales are falling, especially with the launch of the Priv. This was all done with limited carrier partners, and a very limited amount of advertising. Next quarter will have more carrier partners and more regions for the Priv being released in the ER. Even though this is just wishful thinking, I think it's time for the haters and trolls to quit it with their FUD, as BlackBerry is proving that they are here to stay.

posted on Dec 18, 2015, 11:20 AM 2

9. Rydsmith unregistered

While good news this still worries me about their phones. When looking at the information the bulk of the money (or technically lack of loss) is coming from the software side, which makes sense. Between their team ups with Google and Samsung one would hope for this area to become stronger. However, with only 700k phones, this will fall dramatically short of the 5 million Chen set as the line needed to continue to produce handsets. While it's far from doom and gloom, it goes back to my earlier statements that they are much better served in the software and enterprise security role than in handhelds, as lack the competencies needed to compete there.

posted on Dec 18, 2015, 11:21 AM 2

14. Ordinary

Posts: 2454; Member since: Apr 23, 2015

Here we go...

posted on Dec 18, 2015, 11:55 AM 0

18. cnour

Posts: 2305; Member since: Sep 11, 2014

They continue to make phones!!! Good to know.

posted on Dec 18, 2015, 1:48 PM 0

24. Napalm_3nema

Posts: 2236; Member since: Jun 14, 2013

I think it is kind of funny how BB gets treated by the markets. I'm guessing that there is still a lot of fond sentiment on Wall Street for the company, because if Apple or Samsung posted results that were twice as good, they would be pounded by the markets.

posted on Dec 18, 2015, 2:25 PM 0

28. avishekmukherjee

Posts: 362; Member since: Apr 09, 2015

BlackBerry and Sony and HTC will rise again :)

posted on Dec 18, 2015, 11:42 PM 0

29. Bernoulli

Posts: 4364; Member since: Sep 01, 2012

Not HTC, their products can't compete with the rest.

posted on Dec 19, 2015, 1:17 AM 0

30. megathaszrul89

Posts: 203; Member since: Jan 08, 2015

Sad but true, i still counting on BB to create smartphones with PKB. Because i still can't move on from the fun of using htc chacha, moto flipout, nokia xm 5730, e7 and the latest one bb passport. Plz BB, do make another phones with awesome PKB, then I'm sold :)

posted on Dec 19, 2015, 3:28 AM 0

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