Stocks

BlackBerry Ltd Stock Surges On FQ3 2018 Earnings Results

BlackBerry Ltd (NYSE:BB) released its latest earnings report before opening bell this morning. BlackBerry FQ3 2018 earnings amounted to 3 cents per share on a non-GAAP basis. Total revenue came in at $235 million on a non-GAAP basis and $226 million on a GAAP basis. Analysts had been expecting the company to break even on $212.2 million in revenue.

BlackBerry FQ3 2018 earnings

BlackBerry FQ3 2018 earnings review

On a GAAP basis, the BlackBerry FQ3 2018 earnings report revealed a loss of 52 cents per share or $275 million, compared to GAAP losses of 22 cents per share or $118 million in last year’s third fiscal quarter.

Software and services revenue set a new record of $199 million on a non-GAAP basis and $190 million on a GAAP basis, snapping the previous record which was set in the second fiscal quarter. Consensus for software and services revenue stood at around $187 million. BlackBerry’s gross margin also hit a new record high at 77% on a non-GAAP basis and 74% on a GAAP basis. Adjusted EBITDA amounted to $35 million.

The company’s cash, cash equivalents and investments stood at about $2.5 billion as of the end of November; excluding $605 million for its debt, the net cash balance was about $1.9 million. As expected, the cash impact from the Nokia arbitration will be recorded in the fourth fiscal quarter.

The BlackBerry FQ3 2018 earnings release also included a list of the company’s recent customer wins, which include NATO, the U.S. Department of Justice, the Dutch Government, Deutsche Bank, and the U.S. Department of Defense. The company also signed a patent licensing agreement with Teletry during the quarter.

BlackBerry maintains guidance

BlackBerry maintained its previous guidance for the full fiscal year. The company still expects non-GAAP revenue to be between $920 million and $950 million for fiscal 2018. Because of how strong the first three fiscal quarters of the year were, BlackBerry management expects the result to be in the mid to high end of the provided range.

They continue to expect non-GAAP software and services revenue of 10% to 15% for the full year and post positive adjusted earnings per share for the full year. They also still expect to be free cash flow positive, excluding impacts from arbitration awards and damages, restructuring charges and the transition from hardware to software.

After the BlackBerry FQ3 2018 earnings results were released, the company’s stock surged in premarket trading, climbing as much as 8.46% to $11.79 on the New York Stock Exchange.