BlackBerry’s shares are soaring. The company has topped Wall Street’s expectations by quite a bit, despite actually posting a 3 cents a share net loss for Q3.
The original expectations for the company was a 14 cents a share loss, but BlackBerry has topped this by quite a margin and has posted a significant improvement of only 3 cents a share loss, most of which is due to the BlackBerry Priv and an increase in software sales. Additionally, revenue also topped estimates of $488.8 million, with the company posting a revenue of $557 million. Last year, the company posted an extremely slim profit of just 1 cent a share on a revenue of $739 million.
Although it has posted a loss, the company’s hardware sales are up and totalled 700.000 units, which equates to $222.8 million, slightly higher than the previous quarter’s $201 million.
BlackBerry’s CEO has told investors that his first priority is breaking even on phone sales, something he says is coming soon. “Maybe next quarter, maybe a quarter later, but we’re in that ballpark now,” said the executive. He also 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.
Aside from hardware, BlackBerry also showed a major improvement in software and services. Revenue for that group was up to $162 million for the three months, an increase of 183% from last year, and 119% from the second quarter. Because of all of this, BlackBerry’s shares are up by more than 10%.
As usual, BlackBerry continued to have plenty of cash, 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