With emphasis on software and services, BlackBerry reports its highest gross margins ever in Q3

With emphasis on software and services, BlackBerry reports its highest gross margins ever in Q3
BlackBerry reported its fiscal third quarter earnings today, and with the focus on software and services and away from hardware, the company reported a 47% drop in Q3 revenue to $289 million on a year-over-year basis. Software and services was responsible for $160 million of that amount, up 16% from the fiscal second quarter. For the current fiscal year, the company expects top line growth of 30% in the software and services area.

For the fiscal third quarter, BlackBerry overall reported a net loss of $117 million, or 22 cents a share. Excluding certain non-recurring items, BlackBerry had a profit of 2 cents a share topping Wall Street's consensus estimate of a 1 cent a share loss. Last year, BlackBerry reported an adjusted loss of 3 cents a share.Today's report included an all time high in gross margins for the company at 66.8%.

BlackBerry now expects to report a profit for the current fiscal year, after adjustments. Previously, the company expected to post earnings for the fiscal year in a range between breakeven and a 5 cents a share loss.

BlackBerry has completely divorced itself from the competitive hardware business. Just last week, BlackBerry and TCL announced a licensing agreement that will result in TCL designing, manufacturing, promoting, selling and delivering all future BlackBerry handsets.


Investors are happy with the report. On Wall Street, BlackBerry's shares are up 25 cents or 3.2% to $7.96.

source: WSJ

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95 Comments

1. meanestgenius

Posts: 22394; Member since: May 28, 2014

The pivot that BlackBerry has made to a Software and Services company is bearing fruit. BlackBerry made a sound decision in doing so. Now I'm interested to see BlackBerry announce more things along the lines of the IoT and Cyber-Security.

3. darkkjedii

Posts: 31529; Member since: Feb 05, 2011

They're coming on strong.

5. meanestgenius

Posts: 22394; Member since: May 28, 2014

They surely are. They're playing to their strengths, which is a smart business move.

47. darkkjedii

Posts: 31529; Member since: Feb 05, 2011

Very smart bro.

7. libra89

Posts: 2310; Member since: Apr 15, 2016

I agree. Excellent to see that they made the right choice and that it is working out well.

10. meanestgenius

Posts: 22394; Member since: May 28, 2014

They definitely did. Software is something that BlackBerry does extremely well.

20. Podrick

Posts: 1285; Member since: Aug 19, 2015

Mxy is salty after reading this news.

26. meanestgenius

Posts: 22394; Member since: May 28, 2014

Lmao!

48. Crispin_Gatieza

Posts: 3165; Member since: Jan 23, 2014

Yo Meanest, that's how many consecutive earnings reports that infuriate the PA Troll Society? The way I see it, the only real competition BlackBerry has in the Software/IoT/Enterprise field would be Microsoft. It's no secret that Satya Nadella is shifting Windows Mobile in the same direction. They (MS) have the resources but I'm afraid they lack the corporate culture to challenge BlackBerry in this sector(s).

50. meanestgenius

Posts: 22394; Member since: May 28, 2014

Yup! Microsoft and BlackBerry are basically in the same fields now. Microsoft really does have the cash and resources or really challenge BlackBerry in the IoT. I would love to see these two companies get together to work on something for the IoT. Imagine the type of automated home device they could put together, with it being secured by BlackBerry and with Cortana in there, like some sort of 3D projection that can be seen and accessed around your home, running autonomously.

52. phldlphn unregistered

They're still just barely relevant. Their year-over-year revenues have declined by 800% since 2012. I understand brand loyalty and all that, but what made Blackberry "Blackberry" is no longer present. If you want to fanboy over a phone company that now only makes software, then okay, but they've admitted defeat and handed the reigns to TCL who are in touch with current trends. Blackberry made a last ditch effort, if the partnership with TCL didn't work out or ends up failing, you can expect Blackberry to further decline. The reason I'm saying this is because people hooted and howled over Apple's first year-over-year decline, but you are applauded for supporting a company that just two years posted a negative profit. And even this year their profit is down from 2015. They're mediocre at best and barely worth the coverage.

55. meanestgenius

Posts: 22394; Member since: May 28, 2014

So you're trying to say that I can't like a company that's transitioned to a software company now? That's ridiculous. And they're still barely relevant where? In smartphones? Because they're software and services is extremely relevant, that's why it's growing. I understand the hate and and all that, but it was always BlackBerry's software that made BlackBerry what they are, not their phones. It was their MDM and EMM capabilities that truly made them shine. Them licensing out their hardware to other OEM's is a great business move, affords them the opportunity to focus on what they do best, which is software. But touching on phones for a moment, BlackBerry phones were THE smartphone to own. Past management made horrendous mistakes, and BlackBerry has now had or make a pivot to software because of it, after getting new management. Any company in transition is going to have losses, and those losses mainly reflect hardware (which they got rid of), and BIS accounts that are going away since it's now defunct. But their software is growing quarter after quarter, which proves that pivoting to it is the right move. It's people like you that's just stuck on phones, but even Apple sees that phones alone just don't cut it. Every OEM is trying to get into something else, because phones alone can no longer sustain a business indefinitely. What you need to remember is that NO ONE stays on top forever. Nokia didn't. Motorola didn't. And BlackBerry didn't. HTC used to be king of the Android crop. Where are they now? Windows Mobile used to be one of the most dominant platforms in the U.S. Where is WM now? Even Apple almost went bankrupt, and if it wasn't for Microsoft, they wouldn't be here now. Just because you don't like a company, doesn't mean that they aren't worth the coverage. Obviously, someone here at PA agrees with me on that.

61. phldlphn unregistered

It's just an odd thing to fanboy about, haha. As good as Bungie is as a game developer, it was Halo that made them relevant. Same as the BlackBerry phone that enabled you to become a fan of them in the first place. If the BlackBerry phone had never existed and they were only ever a software company, we wouldn't be having this conversation because there would be no fanbase. I don't see any fanboys and next to zero coverage of IBM a much larger, reputable, and more powerful company than BlackBerry could ever hope to be. Do you get what I'm saying? You're literally living in the past, it's okay to let go. Unless you're a software professional, nobody actually gets excited about the newest mobile security software or auto operating systems. Forced hype.

63. meanestgenius

Posts: 22394; Member since: May 28, 2014

Hating on a company for no real reason is odd as well. Oh wait, that's called trolling. It's done here on the regular by dude's like you. My bad. Lmao! You really don't have a clue if you think that it was BlackBerry handsets that made me a fan. It was their MDM software that made me a fan. I became a fan of the handsets after the fact. And correction: We wouldn't be having this conversation had you never bothered to respond to my comment in the first place. I don't care what you don't see. All that means is that you're not looking in the right places. You get what I'm saying? You're literally trolling blindly, as you have no idea what you're talking about. But it's okay, a hater has got to hate. They need something to justify their otherwise meaningless existence. I understand that. So because you don't care about it, or every last one of the 3 people that you know don't care about it, means no one cares about software or auto operating systems? Tell that to the Google and Apple, who not only own the two most dominant mobile SOFTWARE operating systems that have billions of fanboys (including YOU, whether you realize it or not), but who are also getting heavily involved in auto SOFTWARE operating systems (Android Auto and Apple Car). Class dismissed.

64. phldlphn unregistered

How am I blindly trolling? Did I say something that wasn't based on fact? Other than assuming you became a fan of BlackBerry because of their handsets, but you say it's because of the software. BlackBerry would have never become the household name it once was if it was not for their popular handsets. Unless you're trying to tell me you had never heard of BlackBerry until you happened to use their software for the first time and then through their software you learned about the phones that made them relevant at the time? Is that what you're telling me? I've only ever owned one iPhone, and that is the 6S Plus. Before that I had a Lumia and then nothing but Samsungs. I like good devices, that work well. My Samsungs were great, primarily the Note 5. The Note 5 was my favorite device by far in all categories. The only thing I will say is that my 6S Plus does have a better battery that hasn't seen any noticeable decline since I bought it in January. It would be wrong to assume I'm a fanboy of any one operating system, because I like certain things that each one offers and I have no problem calling out people who are loyal to a fault and blindly ignore shortcomings and realities. My only gripe with you is that you act as if BlackBerry is some sort of contender. Again, I wouldn't be saying this on a site that focused on promoting mobile software or what not, but then again I wouldn't be on that type of site to begin with. I come here for phones and BlackBerry is an afterthought in that sense. Am I wrong?

65. meanestgenius

Posts: 22394; Member since: May 28, 2014

How are blindly trolling? Let's see: First: You blindly trolled me with your assumptions. You assume that I "blindly" support BlackBerry because I choose to focus on their strengths. That's not blind support. I have a problem with people who assume, and you clearly haven't been here long enough to see me call out BlackBerry on things like pricing, marketing, and on Chen's stance on net neutrality. You're also assuming that no one outside of software professionals get excited about software. Most of the fanboy fights that take place here are over SOFTWARE. What this OS is capable of vs that OS. Apps and app stores. That's all software. You're also assuming that I give two shts about what handset became a household name and when, and what's popular now. New flash, I don't. As long as the handset of your choice does what you need it to do, and is available for me to purchase, why should I care how popular it is? I'm not a share holder, or some little kid going "nyah nyah, my phone is more popular than yours". That's kid stuff. I'm an ADULT. I do ADULT things. I had heard about BlackBerry, but it was their software that got me liking them. Before then, I was a Nokia Symbian and Windows Mobile handset fan. BlackBerry's software is what intrigued me to try out one of their handsets. Don't really care about what you have and have not owned and used. You're assuming I'm a "fanboy" aren't you? I use multiple OS's on a daily basis, including iOS, Android, BB10 and Windows. I am platform agnostic. It just so happens that I prefer what BlackBerry has to offer, and what's wrong with that? I don't give a sht about what gripe you have with me (even though your "gripe" is pure BS and you're just making up an excuse to troll me), and you can't deny the fact that the BlackBerry DTEK60 offers great bang for your buck. Great camera, stellar software and support, great design and flagship specs for considerably less than what the competition offers. And you really are blind if you think that this site isn't as much about the SOFTWARE that makes these devices so awesome as it is about the shell it's housed in. However, you knowing that BlackBerry has made the pivot to software (even though there will still be BlackBerry Branded handsets in the market. Much to your dismay, I'm sure), and yet you still decided to make your comments on an article which is focused about a now-software company makes you look like a troll. I mean, you didn't have to make a comment here. You chose to. And you chose to troll me for no other reason than the fact that I prefer my handsets running BlackBerry software, whether it's BlackBerry Secured Android or BB10. Now if that's not trolling, then nothing is.

66. phldlphn unregistered

I didn't need your life story, but thank you anyway.

67. meanestgenius

Posts: 22394; Member since: May 28, 2014

Says he didn't need my life story, but have me his entire biography in his post first. Oh, the hypocrisy...

80. phldlphn unregistered

Do you know what sarcasm is?

81. meanestgenius

Posts: 22394; Member since: May 28, 2014

I don't care about your attempt at sarcasm.

86. ablopez

Posts: 235; Member since: Apr 15, 2014

Well thought out responses, MG. For me, he lost me when he started calling you a fanboy. I really hate that people here use that term to try to put someone else down.

87. meanestgenius

Posts: 22394; Member since: May 28, 2014

Thanks, ablopez. Whether you're a male or a female, everyone on this site is a fan of some OEM or OS. We wouldn't be here if we weren't. For him to call me a "fanboy" is just his way of trying to justify his unwarranted dislike of me and my choices. If he wanted to troll me for my choices, he should just admit to it and not hide behind some BS excuse.

88. phldlphn unregistered

It's a pretty well-known fact that meanestgenius is the definition of fanboy when it comes to BlackBerry. You want to take it as an insult, so be it. A fanboy is basically someone who is obsessed with a specific thing, and to say meanestgenius is obsessed with BlackBerry would not be wrong. Just because you like or use other operating systems doesn't make you a fanboy of them and not a fanboy of BlackBerry. The fact you take offense and appear insecure when someone questions the reasons you like a fairly mediocre company in the grand scheme of things only further supports the claim that you are a fanboy of BlackBerry. What articles do you comment most on, BlackBerry. What company do you have the strongest opinion on, BlackBerry. What do you blush and gush over most, BlackBerry. Pretty sure you're a fanboy. You basically react with the same intensity as TechieXP does when Samsung is mentioned, and we can ALL agree he is a Samsung fanboy. You are to BlackBerry as TechieXP is to Samsung as ctdog4748 is to Apple. It's your decision to take offense to something that really isn't that offensive. Thin-skinned, eh?

90. meanestgenius

Posts: 22394; Member since: May 28, 2014

If that's the case (it's not), then it's become pretty obvious that you are a troll when it comes to BlackBerry and when it comes to me. Don't know what I did to burn your bum, but frankly, I don't give a sht. If I'm obsessed with BlackBerry, like you say, then you are obsessed with me over my supposed obsession. My reasons for liking a company are my own. You taking offense to me liking a certain company clearly shows your stupidity. And I say stupidity because it's really stupid to hate on someone for a choice that doesn't bring any physical, mental or emotional pain to you. Or maybe it does? Has BlackBerry touched you in a way that offended you? Have I? Because you're dead set on trolling me for my personal preference. So much so, that you must be in some type of pain. Then again, trolling people for their choice is what trolls do, and you've clearly proven that you are one. And if you think the "grand scheme of things" is which phone is more popular, then you obviously have no idea what a "grand scheme" is. Ted Kord mostly comments on Samsung articles. So does darkk, Trojan_horse, macready, and a few others. Kiko, Alik, ctdog, bubbadoes, and a few others mostly comment on Apple/iOS articles. One or two you've marked as fanboys, so I'd like you to post the link where you questioned them about what they like, and why. Don't worry, I'll wait....oh, wait...you can't link any posts where you've said this to them because you haven't. But for some reason, I, of all of the "fanboys" here, tickle your fancy. So I guess, since you are trolling me, because you clearly haven't mentioned this to any of them, that you're a troll...eh?

92. phldlphn unregistered

Why do you just regurgitate everything I say? I call you a fanboy, you call me a fanboy, I call you obsessed, you call me obsessed, I said you got offended, now I'm apparently offended. You're a child mimicking his superior.

93. meanestgenius

Posts: 22394; Member since: May 28, 2014

I called you a troll in that post, not a fanboy. And you are obsessed with me. Why else would you pick me out of all the so-calIed fanboys here to btch and moan about my choices, which have absolutely nothing to do with you? I don't care what you say about regurgitation, if the shoe fits (and it most certainly does), then wear that motherfcker out. You can call me a kid all you want, but you're who is the real child here? You're literally like a punk@$$ school yard bully that's picking on me for being different and not following the $#33p like you do. Superior people don't waste their time being bumburned by someone's choice. They go about their superior business. Since my choice has obviously wounded you so much that you just had to say something about it, you're not superior. You're just some lonely troll that clearly is both bumburned and obsessed with me for my choices, and you can't dispute that.

94. phldlphn unregistered

Breathe in, breathe out. Repeat. Are you relaxed? Good. You're getting way too worked up over this.

95. meanestgenius

Posts: 22394; Member since: May 28, 2014

In other words, "I picked the wrong dude to troll this time around. Maybe I'll see if I can troll a Samsung or Apple fan instead, especially since Meanestgenius has me dead to rights with his posts." There. I fixed your post for you.

68. Mxyzptlk unregistered

Lol +1

53. phldlphn unregistered

To put it in perspective, at it's height Blackberry was trading at around 144 dollars in 2008. Adjusted for inflation that's around 160 dollars in today's market. Blackberry's current stocks can be bought for about 7 dollars a share. It's just empty praise and useless drivel. There's absolutely no reason to get excited over software on a site that reviews phones.

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