Companies and Brands

BlackBerry Earnings Hammered by Tumbling Revenues

Paul Ausick

Published: April 1, 2016 7:50 am

Last Updated: January 13, 2020 11:17 am

BlackBerry Ltd. (NASDAQ: BBRY) reported fourth-quarter and full-year 2016 earnings before markets opened Friday. The smartphone maker reported an adjusted loss per share for the quarter of $0.03 on adjusted revenues of $487 million. In the same period a year ago, BlackBerry reported earnings per share (EPS) of $0.04 and revenue of $660 million. Fourth-quarter results also compare to consensus estimates for a per-share loss of $0.10 and $563.18 million in revenue.

For the full year, BlackBerry posted revenues of $2.16 billion and an unadjusted net loss of $0.86 per share, compared with revenues of $3.34 billion and an unadjusted net loss of $0.58 in the same period a year ago. Analysts were looking for an adjusted per-share loss of $0.34 on revenues of $2.27 billion. BlackBerry did not report an adjusted net loss for the 2015 fiscal year.

On a GAAP basis, the company posted a fourth-quarter loss of $0.45, compared with EPS of $0.05 per share in the fourth quarter of fiscal 2015. Net loss for the quarter totaled $238 million and $208 million for the year. The quarterly loss was due to the negative effect of $23 million in purchase accounting, $192 million in charges related to restructuring and acquisitions, stock compensation of $17 million, amortization of acquired intangibles of $28 million and a non-cash credit of $40 million.

BlackBerry posted free cash flow of $6 million, its eighth consecutive quarter of positive results. Adjusted EBITDA totaled $78 million in the quarter.

Here’s the company’s outlook state for the current fiscal year:

The company expects to grow software and services at around 30 percent. The Company continues to anticipate positive free cash flow and adjusted EBITDA for the full 2017 fiscal year.

The consensus estimates for the first quarter of BlackBerry’s 2017 fiscal year call for an adjusted per-share loss of $0.10 on revenues of $551.02 million. For the full year, analysts expect a per share loss of $0.37 on revenues of $2.1 billion.

The company’s CEO said:

Overall, BlackBerry’s Q4 performance was solid as we made progress on the key elements of our strategy, which are to grow software faster than the mobility software market, achieve device profitability and generate positive free cash flow.

We have clearly gained traction and market share in enterprise software. We more than doubled our software and licensing revenue in Q4 and exceeded our target of $500 million for the full year. Looking to FY 2017, our strategy is on track and our growth engines are in place to continue to generate above market growth in software and achieve our profitability objectives

Shares closed at $8.09 on Thursday, up 1%, and traded down about 6% in Friday’s premarket session at $7.60. The stock’s 52-week range is $5.96 to $11.09. The consensus analyst price target was $7.86 before results were announced.