After several quarters of inconsistent results in the past few years, shares of BlackBerry (TSX: BB) responded positively last week. The company finally reported two straight quarters of profits and revenues that beat consensus estimates. Not only is software driving growth but the company is forecasting full-year profits. The software company now holds the potential to give its investors a positive return.
BlackBerry forecast revenue of up to $950 million for FY 2018 (against the $927.2-million consensus). It expects positive earnings ("EPS").
Revenue from software and sales will growth between 10% to 15%. In the third quarter, BlackBerry reported a new record of software and services revenue of $199 million. The company added an impressive 3,000 enterprise customer orders. Even more pleasing are the government entities BlackBerry added to its customer list: NATO and the U.S. DoD.
Cash grew to a solid $2.5 billion while gross margin topped 77%. With short interest still at 8.7% of float, bears need to consider covering the bet against the company. A new age is dawning for the former smartphone supplier. If the company secures the majority of the one billion devices in the enterprise by 2020, revenue will return to the billions (or close to it) in that time.
