This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

BlackBerry CEO 'Pleased' With $42 Million Loss

NEW YORK ( TheStreet) -- BlackBerry (BBRY - Get Report) announced that it narrowed its losses but revenue continued to sink in the fiscal fourth quarter. But that didn't stop CEO John Chen from boasting that he was "pleased" with the results.

Although reporting a $42 million loss on revenue of $976 million (off 18% from the previous quarter and 64% from the year before), the loss was only 8 cents a share, excluding one-time charges. Analysts had been predicting a loss of 55 cents. GAAP loss was $423 million, or 80 cents share.

Blackberry shares were gaining nearly 2% to $9.22 in premarket trading following the announcement.

Revenue estimates had been $1.1 billion following last quarter's $1.19 billion and last year's $2.7 billion fourth-quarter numbers. In the latest fourth quarter, $546.6 million came from BlackBerry services ($562 million has been estimated), $362.1 million from hardware ($446 estimated.) while $68.3 million came from software after estimates had been in the $59 million range.

Adjusted fourth-quarter gross margin was 43%, up from 34% in the fourth quarter a year earlier. Total operating expenses were down significantly from $906 million a year ago and $865 million in the previous quarter to $601 million in the fourth quarter. Analysts had been predicting $766 million.

The company is hoping to report a positive cash flow by this time next year. Chen said "BlackBerry is on sounder financial footing today with a path to returning to growth and profitability."

In the previous quarter, BlackBerry announced it sold less than 2 million smartphones, which was off more than 70% from its sales numbers in the previous year. The company was forced to take a $1.6 billion write-off on its unsold inventory, mostly from new BB10 smartphone devices. And that was on top of a nearly $1 billion inventory hit it had to deal with in the previous quarter.

To help the situation, Blackberry has entered into a five-year partnership agreement with Foxconn to manufacture its smartphones. It is also in the process of restructuring all of its businesses, firing employees (for the most part in its devices division) and selling off real estate properties in the U.S. and Canada and leasing back space for a newer, leaner company.

BlackBerry is hoping its recent moves will help slash the company's operating costs in half by the end of its first quarter in May. 

The company has begun having some success by offering its BBM service to Apple (AAPL) users as well as fans of Google (GOOG) Android devices from Samsung, LG and others. "Line" and "WeChat," in particular, have been good at generating in-app streams of revenue by offering

BlackBerry's appeal to enterprise users still remains strong despite a somewhat constant drain of customers to other platforms. It was down from nearly 80 million in 2013 to a reported 55 million at the end of last quarter. BBRY has been trying to counter the steady customer drain with its BlackBerry Enterprise Server (BES) offerings for iOS and Android devices.

-- Written by Gary Krakow in New York.

To submit a news tip, send an email to tips@thestreet.com.

Gary Krakow is TheStreet's Senior Technology Correspondent.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
BBRY $8.00 2.60%
AAPL $122.50 -0.71%
FB $95.15 -0.15%
GOOG $630.31 0.37%
TSLA $263.82 -0.38%

Markets

Chart of I:DJI
DOW 17,751.39 +121.12 0.69%
S&P 500 2,108.57 +15.32 0.73%
NASDAQ 5,111.7330 +22.5270 0.44%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs