BlackBerry is now a thriving software business
BlackBerry’s (BB) hardware business faced a massive downturn with the advent of smartphones like Apple’s iPhone. However, under the new leadership of John Chen, who took over in 2013, the company has turned its fortunes around by switching from the intensely competitive hardware business to a profitable software business.
The Canadian company has now made its name in the cybersecurity and Internet-of-Things businesses. The company reported results for its fourth quarter of fiscal 2019 (quarter ended February 2019) on March 29. The stock surged 10% after BlackBerry reported its earnings.
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Wall Street was happy with BlackBerry’s recent earnings
The company generated GAAP revenue of $255 million in the fourth quarter, a 9% YoY jump from the same quarter the last fiscal year. $246 million of its revenues came from its Software and Services business, which grew 16% YoY.
As the graph above shows, BlackBerry’s revenue growth has been moving in the right direction after several quarters of negative growth. BlackBerry earned $0.09 per share in the fourth quarter compared to $0.08 per share in the same quarter last year.
The company recently acquired Cylance, a company that uses artificial intelligence and machine learning for cybersecurity. Banks are the biggest customers of Cylance.
BlackBerry, which faced an existential threat a decade or so ago, is now a thriving software business that’s in the green. Wall Street likes that, and the stock is up 42% year-to-date.