BlackBerry reports $670M Q1 loss

WATERLOO, Ont. – BlackBerry had a US$670 million net loss in the first quarter of its 2017 financial year, but says its recovery plan for this year remains on track.

The loss amounted to $1.28 per share and included a US$501-million writedown of the smartphone company’s assets and $23 million in restructuring charges, among other things.

Excluding several items, BlackBerry came close to breaking even with an adjusted loss of US$1 million – which was better than analyst estimates.

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But revenue was below analyst estimates at US$400 million under generally accepted accounting principles, or US$424 million with certain adjustments.

BlackBerry’s first-quarter numbers, reported in U.S. dollars, were announced a day after CEO John Chen told BlackBerry’s annual general meeting that the company’s No. 1 goal is to make its smartphone device business profitable this fiscal year.

“Our current plan calls for continued investments to expand our addressable markets and drive sustainable profitability and revenue growth,” Chen said in Thursday’s statement, before a conference call with analysts.

The company said Thursday it has begun to report revenue by three main segments: software and services, service access fees and mobility solutions, which includes BlackBerry smartphones.

“For the full fiscal year, we are on track to deliver 30 per cent revenue growth in software and services . . . In our mobility solutions business, our objective is to achieve operating profitability in the short term,” Chen said.

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In the three months ended May 31, which is the first quarter of BlackBerry’s 2017 financial year, the smartphone segment generated $152 million of revenue and had a $21-million operating loss.

The other two segments showed operating profits: $37 million from software and services and $78 million from service access fees.

Analysts had estimated US$470.43 million of revenue for the quarter ended May 31, an adjusted loss of seven cents per share and a net loss of 16 cents per share, according to Thomson Reuters data.

Chen said Thursday that BlackBerry is on track to have an adjusted loss of about 15 cents per share “compared to the current consensus of a 33-cent loss.”

Chen has said the company will stop making smartphones if the device business remains unprofitable, but doesn’t believe that will be necessary. The company hired a new senior vice-president of global device sales in late April to help its smartphone business.

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