BlackBerry posts surprise quarterly profit on resilient cybersecurity demand
Canada’s BlackBerry (BB.TO) reported a surprise quarterly profit on Wednesday, backed by a resilient demand for cybersecurity services amid rising online threats.
While IT spending has dwindled over the past year, cybersecurity-related expenditure has remained stable as businesses and governments scramble to beef up their systems against hackers.
Over the past few months, casino giants such as MGM Resorts International (MGM.N) and Caesars Entertainment (CZR.O) faced large data breaches, forcing businesses to prioritize cybersecurity.
Earlier this month, BlackBerry discarded its initial public offering plans for its Internet of Things (IoT) business, but still expects to split the IoT and Cybersecurity businesses into fully standalone divisions.
“Work has commenced to fully separate and significantly rightsize our businesses, and we expect to further reduce operating cashflow usage in Q4,” said CEO John Giamatteo.
BlackBerry also plans to simplify the corporate structure of the company so that each business unit may operate independently and on a profitable and cashflow-positive basis.
BlackBerry expects fourth-quarter revenue in the range of $150 million to $159 million.
The Waterloo, Canada-based company reported adjusted net profit of 1 cent per share in the quarter ending Nov. 30, compared with a loss of 5 cents per share a year earlier.
Revenue in the third quarter rose to $175 million from $169 million. Analysts on average had expected revenue of $173.5 million, according to LSEG data.
US-listed shares of the company fell 4 per cent in extended trading.