Waterloo, Ontario – BlackBerry Ltd’s (NASDAQ: BBRY) priority for this year is making their devices profitable, CEO John Chen stated at the company’s annual general meeting on Wednesday.
Blackberry released its first Android phone, the Priv, in November 2015. With an initial price of $899, and later sold under $600, the phone did not manage to lift sales. It is considered by some analysts the last shot at handset sustainability for BlackBerry.
Chen said that the company should rather focus on providing security software than focusing on increasing the capabilities of the hardware. The company’s focus is given since Chen doesn’t believe the earnings on handsets will not be enough to support the business.
The “devices are going to be the future of any company”, Chen said, according to The Globe and Mail. This way, they can get back their high position in the tech sector. Hardware contributed to only 39 percent of the company’s total revenue on 2016 until May, with a total of $180 million with 600,000 units sold.
— WLST.com (@wlstcom) June 23, 2016
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Chen commented about the focus on software the company pretends to increment, that he had spent more than a billion dollars acquiring companies that would work on enhancing the software. This way, BlackBerry could reposition itself as a software and service provider, offering security software and device management for large organizations. Chen is aiming to grow BlackBerry’s software business, hoping for 30 percent in one year.
The results for the first quarter of fiscal 2017 earnings, which ended on May 31, will be released on Thursday. Analysts expect Blackberry to report a loss around $27 million, while the consensus on revenue oscillates around $471 millions for the quarter. Some analysts expect a worse development of the quarter, expecting $431 million and phone sales falling to barely 500,000.
About the coverage from analysts of the company’s revenue, Chen said they were negative and did not favor the company. To fight this, BlackBerry will work with some other analysts and get more positive recognition.
— Blackberry News (@Blackberry_News) June 23, 2016
Last quarter, BlackBerry reported a net loss of $230 million, mainly because of expenses in restructuring and acquisition.
Chen stayed active and talked about the company’s intentions on expanding its Internet of Things offerings, and the growth expected in software revenue.
Source: The Globe and Mail