BlackBerry’s executive chairman and CEO John Chen (pictured) said the company is poised to return to profitability within the next 12 months, after it began to gain traction in key areas of its renewed strategy during its fiscal Q4 2017.
The company slashed operating costs and net loss in the recent quarter, which covers the three months to end-February 2017 – results Chen said matched or bettered analysts’ predictions for the period as BlackBerry began to benefit from an improved revenue mix in its software and services business.
In its earnings statement, BlackBerry pointed to a key licensing deal with Optiemus Infracom, the launch of the BlackBerry KeyOne by TCL, an announcement covering connected car software, and a new enterprise SDK as highlights of the recent period.
“In the quarter, we continued to grow our mix of software and services revenue across the company. In turn, this allowed us to expand our operating margin and report positive free cash flow. In addition, our balance sheet continues to strengthen and benefit from reduced capital requirements with our focus on software and licensing,” Chen said.
The CEO added BlackBerry is “executing well and gaining traction” in its areas of strategic focus, enjoyed “one of our best-ever software billings quarters” in its enterprise business, won new business in IoT appliances, and secured global coverage in terms of mobile device licensing.
Chen said BlackBerry’s performance during fiscal Q4 leaves it confident of growing “at or above the overall market in our software business,” and of turning a profit on a non-GAAP basis during fiscal year 2018.
The company reported a net loss of $47 million in fiscal Q4 2017, well below the $238 million loss recorded in the same period of fiscal 2016. While revenue fell from $464 million in fiscal Q4 2016 to $286 million in the recent quarter, BlackBerry reined in its cost of sales and operating expenses year-on-year.
Despite Chen’s confidence, in its full FY2017 BlackBerry’s net loss soared to $1.2 billion from $208 million in FY2016. Full year revenue of $1.3 billion was down from $2.1 billion in fiscal 2016.
The company registered 30 per cent annual growth in software revenue in FY2017, hitting the target set by Chen for the period, Bloomberg reported.