When BlackBerry (BBRY) reports quarterly earnings on March 31, over 240 institutional investors holding 319 million shares will glean through the results. These investors will only care about software revenue acceleration continuing in the quarter.
As BlackBerry’s services revenue falls again, a natural result of winding down pre BB10 devices, expect device sales falling. There still a chance DTEK50 and DTEK60 sales did better than expected. Despite a lack of significant marketing, any sales should add positively to profits. The company would benefit from scale, selling millions of units monthly. Since the devices unit is now outsourced, scale is secondary. BlackBerry will still make money for every device sold.
CEO John Chen may give an update on sales of QNX-based solutions. Already, the company inked a deal with Ford (F). The automotive company doubled QNX content, which translates to higher revenue for BlackBerry and a bulk discount for Ford.
Secure IoT solutions are still in their infancy. Revenue will not be meaningful but forecasts for triple-digit growth is the minimum expectation.
EMM Strength
With little competition in the mature but scalable market, expect sales for BES12 growing in the double digits. BlackBerry’s UEM solution is in the #1 or #2 worldwide, based on market share or revenue. Expect revenue of over $400 million from EMM, thanks to the BlackBerry/Good integration. BlackBerry released a version of BES that no longer requires Good as a separate server instance.
Healthy balance sheet
BBRY has over $1.3 billion in cash. Its balance sheet is still healthy as is its line of credit and convertible debt.
Takeaway
BlackBerry’s quarterly results should not lead to a wide move on the markets.
