Blackberry Results Top Forecasts, Fueling Recovery Hopes
June 19, 2014
BlackBerry posts a narrower-than-expected loss as the troubled smartphone maker's turnaround efforts start to pay off, raising hopes that its CEO can deliver on a pledge to return the company to steady profits.
WATERLOO, Ontario -- BlackBerry Ltd. (IW 1000/412) posted a narrower-than-expected loss as the troubled smartphone maker's turnaround efforts started to pay off, raising hopes that its CEO can deliver on a pledge to return the company to steady profits.
Shares jumped more than 10% on Thursday after BlackBerry said it spent less cash than many expected and its gross profit margin rose from a year earlier.
BlackBerry also said its lower-cost Z3 smartphone was selling well in Indonesia and its services business, which manages its own and rival mobile devices on the internal networks of large organizations, had won back some customers.
"The short trade is over in this name for now," said BGC analyst Colin Gillis. "They've got enough liquidity, [and] they've given us clear profitability targets."
The Waterloo, Ontario-based company reported net income of $23 million, or 4 cents a share, compared with a loss of $84 million, or 16 cents, a year earlier.
Excluding a one-time noncash accounting gain and certain restructuring charges, the loss was $60 million, or 11 cents a share. Analysts on average had expected a loss of 25 cents a share, according to Thomson Reuters I/B/E/S. Quarterly revenue dropped to $966 million from $3.07 billion a year earlier.
Cash rose to $3.1 billion from $2.7 billion on a sequential basis, helped by the sale of real estate assets and a tax refund.
BlackBerry's Nasdaq-listed shares rose 13.2% to $9.39.
