Post Earnings Coverage as BlackBerry Beats Market Expectation

LONDON, UK / ACCESSWIRE / June 24, 2016 / ActiveWallSt.com announces its post-earnings coverage on BlackBerry Ltd. (NASDAQ: BBRY). The company reported Q1 FY17 financial results on Thursday, June 23, 2016. The smartphone maker posted adjusted breakeven earnings per share, topping expectations, and forecast a lower than expected loss for the year, as it continued to cut costs and grow its software business. Register with us now for your free membership and see our complete earnings coverage on this equity at:

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Earnings Review

For the period ended on May 31, 2016, Blackberry, on a GAAP basis, posted a net loss of $1.28 as compared to a net loss of $0.10 per share in Q1 FY16. The quarterly loss was primarily attributable to non-cash, long-lived asset impairment charge of $501 million. Non-GAAP net income was $14 million, or breakeven for Q1 FY17, against analysts’ expectations of a loss of $0.80 per share. For Q1 FY17, the company reported Non-GAAP revenue of $424 million, against the analysts’ expectation of $470.94 million.

The Waterloo, Canada-based Company reported that Non-GAAP software and services revenue came in at $166 million during Q1 FY17, while Non-GAAP gross margin was 53%. During Q1 FY17, Blackberry added approximately 3,300 enterprise customers, and nearly 74% of the software revenue was recurring. The company did not provide the number of handsets sold during the reported quarter. Adjusted EBITDA was positive for a consecutive tenth quarter. The company has purchase-orders worth $150 million by the quarter’s end, lower compared to the $238 million in the year ago period.

Guidance

BlackBerry Executive Chairman and CEO, John Chen, announced in the press release that the company expects to record a 30% increase in software and services revenue for FY17 and non-GAAP loss of $0.15 per share. BlackBerry is also aiming to become cash flow positive for the full year. Analysts’ consensus estimates for Q2 FY17 was for an adjusted loss of $0.09 per share on revenues of $454.85 million. For FY17, analysts forecast a per share loss of $0.33 on revenue of $1.8 billion.

Stock Performance

Blackberry’s guidance gave a boost to the stock as it closed higher by 3.86% at $7.00 post the earning release. The once dominant handset maker has struggled against the onslaught of touch-based smartphone makers such as Apple Inc. (NASDAQ: AAPL) and Alphabet Inc. (NASDAQ: GOOGL) maker of Android OS. The company share price has slumped 24.57% since the beginning of the year as compared to S&P 500 which is up 3.39% during the same time frame.

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