BlackBerry Ltd (BBRY) Records 20% Growth In Software Revenue In 4Q

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BlackBerry Ltd (NASDAQ:BBRY)(TSE:BB) seems to be gaining from the turnaround efforts initiated by its CEO John Chen. Its revenue might have missed the Street analysts’ predictions. However, it recorded 20% YOY growth in software revenue in the fourth quarter. Sequentially, the growth was 24%. The uptick in software appears to be in line with the company’s shift towards software-related revenue.

Positives From 4Q

There are also other positives from BlackBerry Ltd (NASDAQ:BBRY)’s fourth quarter results. For instance, it reported adjusted earnings whereas the Street was estimating a loss per share. In fact, they have cut their estimations for a wider loss of five cents compared to its earlier predictions of three cents of loss per share within the last week. Similarly, the company generated normalized cash flow of $76 million during the fourth quarter in contrast to $784 million cash usage in the prior year quarter.

The company also achieved adjusted gross margin of 48.3% whereas the reported margin was 48.2%, which was the third straight quarter of favorable hardware gross margin. It could increase $608 million in the fourth quarter towards cash and investments balance to $3.27 billion. This meant that it matched the highest balance recorded by it.

Profit & Revenue

BlackBerry Ltd (NASDAQ:BBRY) reported net income of $28 million or five cents a share in the fourth quarter. In comparison, it incurred a net loss of $423 million or a loss of 80 cents a share in the year-ago quarter. On an adjusted basis, it earned $20 million or four cents a share. Revenue fell 16.8% to $660 million from $793 million in the previous year quarter. Street analysts’ estimated the company to report a loss of five cents a share and revenue of $786.42 million.

For the fiscal year ending in February, the company suffered a loss of $304 million or a loss of 58 cents a share. This was narrower than a loss of $5.87 billion or a loss of $11.18 a share in the preceding year. Revenue plunged 51% to $3.34 billion from $6.81 billion in the prior year.

Outlook

Moving ahead, BlackBerry Ltd (NASDAQ:BBRY) said that it would continue to expect favorable free cash flow in the current fiscal year. The company said it was aiming to achieve sustainable adjusted profitability in the current fiscal year besides expanding its distribution capacity.

Viraj Shah

Viraj Shah has completed M.Com (Finance) and is currently pursuing his CFP. He tracks US markets along with other global markets like India very closely. He is very passionate about stocks, real estate, and technology. He also believes that money can always be made in the market.

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