BlackBerry Takes The Next Big Leap
BlackBerry Ltd (NASDAQ:BBRY) has been in the news following leaks about its new model “DTEK60” and it remains to be seen whether the new smartphone meets and exceeds expectations.
However, Blackberry CEO John Chen has just raised the guidance and has announced a new strategic direction for the company’s “Mobility Solutions” division, which is likely to take BBRY stock to new highs.
BlackBerry Ltd has reported 89% year-over-year growth in generally accepted accounting principles (GAAP) software and services revenue for Q2 fiscal 2017. The total revenue stands at $334.0 million, whereas the net loss was $0.71 per share. The company has raised its full-year adjusted earnings per share (EPS) outlook to break even, with a loss of $0.05 per share. (Source: “BlackBerry Reports 89% Year over Year Growth in GAAP Software and Services Revenue for Q2 Fiscal 2017,” BlackBerry Ltd, September 28, 2016.)
The company has also announced a licensing agreement with Indonesian telecom joint venture PT BB Merah Putih, for production, distribution and promotion of BlackBerry-branded devices. This means the focus now shifts to developing secure software. BlackBerry’s CEO had earlier announced that if the handset division does not turn out to be profitable, the company might start focusing on being a software company.
BlackBerry has also announced the appointment of Steven Capelli as chief financial officer, with John Chen saying, “ I look forward to the many contributions he will make towards driving value for BlackBerry shareholders as we continue to focus on end-to-end mobility solutions and enterprise software.”
BlackBerry stock has been inching up gradually over this month, which gives some indication that the market is expecting the company to let go of its handset division if it is not showing any signs of being profitable. The company has been trying new ways to sell its smartphones since the beginning of this year. The good results and outlook are likely to take BBRY stock to new highs.
The past quarter has been eventful for BlackBerry, since it was when the company launched its new smartphone “DTEK50,” which was a rebranded Alcatel phone. That model was marketed as the most secure phone. And now the company is all set to unveil its third “Android”-powered smartphone DTEK60, which has just been certified by the U.S. Federal Communications Commission (FCC) and the Wi-Fi Alliance. This is likely to boost BBRY stock further.
The company has also announced other products and services, together with new alliances. As the BlackBerry CEO fine-tunes his strategy revolving around software, investors will be watching every move he makes. The focus of the company toward more profitable ventures is likely to send BlackBerry stock soaring.