BlackBerry reports boost in software growth
BlackBerry reveals its Q3 financials and now raises its full year non-GAAP EPS outlook
BlackBerry has revealed its transition into software services has boosted its earnings, beating Wall Street's expectations, however there are concerns regarding overall growth.
The Canadian company did not meet revenue expectations as it made $301m compared to the $332m it expected to make. BlackBerry's shares also gained 4.4% on its earnings results.
For Q3, BlackBerry revealed a net loss of $117m compared with a loss of $89 million Q3 2015, plus revenue in the recent period was $289 million, down from $548 million in the 2015 quarter.
BlackBerry is now a software company and the market leader in mobile security," said John Chen, executive chairman and CEO, BlackBerry. "We achieved significant milestones in Q3, delivering the highest gross margin in the company's history for the second consecutive quarter and continuing to transform our infrastructure and operations to support an enterprise software business.
"As the number of mobile-connected devices continues to proliferate, we expect growing demand in our areas of strength, including security and embedded software," continued Chen. "The recent agreements with Ford and TCL are positive proof points on our value proposition in these emerging growth areas. We have a pipeline of opportunities to continue our momentum.
"We remain on track to deliver 30% growth in company total software and services revenues for the full fiscal year. We are raising our outlook on profitability for FY17. We now expect to achieve non-GAAP EPS profitability for the full year, up from a prior range of breakeven to a five cent loss. This is the third consecutive quarter we have increased our EPS outlook, reflecting the traction we are achieving in our shift to a software business model. We also anticipate breakeven non-GAAP EPS and approximately breakeven free cash flow in Q4."
BlackBerry is not only transitioning from hardware to software service, as it recently announced it is investing $75m in an autonomous vehicle testing hub, and also focussing on security services.