BlackBerry has unveiled the company’s Q1 FY2016 earnings report. BlackBerry quarterly software revenue jump has jumped an this has resulted in the shares climbing up. In essence, the sales at its crucial software segment rose in the first quarter and its broader revenue slide began to ease. Excluding a one-time accounting gain and charges related to restructuring, the company reported a first-quarter loss of US$28 million, or 5 cents a share.
During the Q1 FY2016 earnings call, BlackBerry CEO John Chen also mentioned that due to the decline in hardware profits, resources have been diverted the hardware division to bolster focus on software and Internet of Things (IoT).
Furthermore, at the earnings call, he highlighted as well that the hardware is solely for profitability.
Overall, it seems like this further highlights that John Chen’s strategy is working well for BlackBerry!
| Spoiler Inside: Press Release | SelectShow |
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WATERLOO, ONTARIO–(Marketwired – June 23, 2015) – BlackBerry Limited (NASDAQ: BBRY)(TSX: BB), a global leader in mobile communications, today reported financial results for the three months ended May 30, 2015 (all figures in U.S. dollars and U.S. GAAP, except where otherwise indicated). Q1 Highlights — Software and technology licensing revenue of $137 million, a 150% Q1 Results Non-GAAP loss for the first quarter was ($28) million, or ($0.05) per share, compared to a loss of ($0.11) per share in the same year-ago period. GAAP basic net income for the quarter was $68 million, or $0.13 per basic share. Basic GAAP net income includes non-cash income associated with the change in the fair value of the debentures of $157 million (the “Q1 Fiscal 2016 Debentures Fair Value Adjustment”) and pre-tax charges of $61 million related to restructuring. The impact of these adjustments on GAAP net income and earnings per share is summarized in a table below. Total cash, cash equivalents, short-term and long-term investments was $3.32 billion as of May 30, 2015. The cash balance increased $50 million in the first quarter. Excluding $1.25 billion in the face value of our debt, the net cash balance at the end of the quarter was $2.07 billion. Purchase orders with contract manufacturers totaled approximately $238 million at the end of the first quarter, compared to $394 million at the end of the fourth quarter. Operating cash flow was $134 million with free cash flow (operating cash flow minus capital expenditures) of $123 million. In Q1, BlackBerry completed its acquisition of WatchDox, a leading provider of secure enterprise file-sync-and-share (EFSS) solutions that allows users to protect, share and work with their files on Android, iOS, Windows Phone, BlackBerry and PCs. WatchDox will be integrated into BlackBerry’s BES12 Enterprise Mobility Management solution, extending the company’s ability to secure communications end-to-end from voice, text, messaging and data to now include documents. In addition to BlackBerry’s existing partnership with Foxconn, the Company also entered into joint development and manufacturing agreements with Wistron Corporation and Compal Electronics. These agreements will reduce the time to market of new devices, streamline the supply chain, leverage greater economies of scale and enable resource and fixed asset reductions for greater business efficiency – which are all significant steps toward BlackBerry achieving profitability in its devices business. “I am pleased with the strong performance of our software and technology business. This is key to BlackBerry’s future growth,” said Executive Chairman and CEO John Chen. “Our financials reflect increased investments to sales and customer support for our software business. In addition, we are taking steps to make the handset business profitable. We believe these actions are prudent and necessary to grow the business and we believe the remaining milestones in our strategic plan are achievable.” Outlook The company continues to anticipate positive free cash flow. The company continues to target sustainable non-GAAP profitability some time in fiscal 2016. Reconciliation of GAAP gross margin, gross margin percentage, income before income taxes, net income and earnings per share to Non-GAAP gross margin, gross margin percentage, loss before income taxes, net loss and loss per share: (United States dollars, in millions except per share data) For the three months ended May 30, 2015 Note: Non-GAAP gross margin, gross margin percentage, loss before income taxes, non-GAAP net loss and non-GAAP loss per share do not have a standardized meaning prescribed by GAAP and thus are not comparable to similarly titled measures presented by other issuers. The Company believes that the presentation of these non-GAAP measures enables the Company and its shareholders to better assess the Company’s operating results relative to its operating results in prior periods and improves the comparability of the information presented. Investors should consider these non-GAAP measures in the context of the Company’s GAAP results. (1) During the first quarter of fiscal 2016, the Company reported GAAP gross Supplementary Geographic Revenue Breakdown BlackBerry Limited | |
