As has become standard for BlackBerry over the last few quarters, the company has once again posted another loss, though, as is also the norm, software sales are constantly increasing and the reliability on smartphones sales for revenue is decreasing.
Earlier today, BlackBerry announced its Q3 2017 fiscal results, this time reporting a loss of $114 million versus a revenue of $289 million. Now, although this may seem pretty bad, it’s worth noting that software sales are, in fact, increasing and hint at possible profitability within the next year. Currently, though, the company is having trouble dealing with the significant drop in smartphone sales which, back in September, led the company to confirm rumors that they would exit the smartphone hardware market, though only recently was it confirmed that TCL had taken over design and manufacturing of any future BlackBerry devices due to a licensing agreement.
Comparing this quarter’s result to Q3 2016, the full effect of their slow retreat from the smartphone market can be appreciated, with the company previously posting $548 million – nearly double the revenue of this quarter. As well as this, the company’s loss was significantly smaller at $89 million. Looking at this quarter’s stats, though, the company has made clear that its mobile division is becoming less important for the company, with only 23 percent of revenue coming from the division versus the 55 percent which came from its software. The company’s software sales are doing so good, in fact, that sales have consistently increased over the past year. There is one downside, though. With the company bleeding cash constantly it was inevitable that the company’s cash reserves would be significantly hit, but over the last quarter the company’s reserves have suffered a significant bashing, with reserves now valued at $1.6 billion, down from nearly $2.5 billion last quarter.
With the company centering itself around its software sales, it’s no surprise the company isn’t afraid about investing its money, most recently into a new self-driving car testing hub where it can test its software solutions for the automotive market. It’s pretty clear that BlackBerry CEO John Chen’s plan is working, especially considering that their software is delivering its highest gross margin ever, so it shouldn’t be too long before BlackBerry is back in the black and at its best.