Smartphone maker BlackBerry Ltd. (NASDAQ: BBRY) sold most of its Canadian real estate — more than 3 million square feet — earlier this year for $278 million. Last Thursday the company announced that it has agreed to sell an R&D facility in Germany to Volkswagen for an undisclosed sum.
Along with the plant, VW will get 200 BlackBerry employees who will join Volkswagen Infotainment GmbH, the company VW has established to develop technologies for managing in-car information and entertainment systems.
Dumping its real estate is one thing that BlackBerry can do to help boost its cash flow and return to profitability. For its most recent quarter, BlackBerry reported revenues of less than $1 billion, down more than two-thirds from the year-ago quarter. The reported net loss, however, was only half as large as analysts expected and the company’s stock jumped 10% on the report to trade at around $9.50 a share.
BlackBerry has released photos and pre-release versions of its coming Passport phone, which is officially due in September. The early hardware has been impressive, but BlackBerry’s share of the smartphone market has fallen so far that even blockbuster phone sales will not help.
CEO John Chen appears to have clarified the company’s position on hardware — “I hope nobody thinks we don’t take seriously the handset business.” — and had already made clear his position on software — “I don’t find the practice [of giving away software] very sensible.” BlackBerry may want to make sales of its hardware, but it must sell its software and services. Not only that, it must show that software and services revenues are growing. BlackBerry’s future, if it has one, is in software.
The company’s stock has risen another $1.10 since that mid-June earnings report, closing at $10.61 on Thursday, in a 52-week range of $5.44 to $12.18. Nearly 13 million shares of BlackBerry shares trade every day.
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