Blackberry (TSX:BB)(NYSE:BB) stock fell 0.61% on July 4. Shares have fallen sharply after the release of its first quarter fiscal 2020 results.
Blackberry gained significant momentum in its spring earnings release, mostly on the back of an uptick in its revenue forecast courtesy of CEO John Chen. The company’s blockbuster acquisition of Cylance was expected to boost revenues and compliment its cyber security and QNX development. Results in the first quarter showed this is on track in several key departments but the latter segment will still require time. Non-GAAP earnings per share rose $0.01 per share on revenues of $267 million, which beat Wall Street estimates.
One of the chief concerns that may have driven Blackberry’s sharp post-earnings dip stem from the rise of a Cylance competitor; Crowdstrike Holdings. Chen dismissed the criticism and praised Cylance as "undervalued".
Blackberry’s foray into automation continues to hold huge promise. Its QNX technology is now in over 150 million cars worldwide. This is up 25% from the prior year. Blackberry’s expanded partnership with LG Electronics will allow it to expand its offering in infotainment systems and other components in internet-connected vehicles.
Blackberry’s footprint in these burgeoning markets make it difficult to turn away from the tech stock right now. Its volatility is frustrating, but I still like Blackberry as a long-term buy-and-hold. The stock had an RSI of 30 at the time of this writing, which puts it just outside of technically oversold territory.
