BlackBerry (NYSE:BB) is set to announce its second-quarter fiscal 2024 results on September 28, and there are several factors to keep in mind leading up to the earnings release.

Earnings Expectations

The Consensus Estimate anticipates a loss of 2 cents per share, a figure that has remained unchanged over the past 60 days. In the same period last year, BlackBerry reported a loss of 5 cents per share. Notably, in the previous quarter, BlackBerry surpassed expectations by reporting adjusted earnings per share of 6 cents, surpassing the Consensus Estimate of a 5 cent loss. This indicates that BlackBerry has the potential to outperform expectations.

Revenue Performance

In the last reported quarter, BlackBerry reported total revenues of $373 million, a significant increase from the prior quarter $168 million. BlackBerry not only exceeded expectations but also reported robust revenue growth compared to the Consensus Estimate of $159.4 million.

Business Strategy

BlackBerry has been actively investing in product development and refining its go-to-market strategy as part of its long-term sustainable growth plan. The company has strategically aligned its software and services business around two key market opportunities: Cybersecurity and the Internet of Things (IoT).

Factors to Consider

BlackBerry recently provided a preview of its financial results for the second quarter of fiscal 2024. Some key points to note include:

Cybersecurity Challenges: BlackBerry’s Cybersecurity division has been facing prolonged sales cycles, particularly within the government sector. Additionally, delays in finalizing significant deals are expected to have an impact on the revenues recognized for the upcoming quarter.

IoT Opportunities: On the positive side, BlackBerry’s IoT business division is benefiting from opportunities in a vast market, poised to capitalize on multi-year secular trends. However, it faces short-term headwinds due to certain automakers delaying software development programs and production schedules.

Revenue Projections

For the fiscal second quarter, BlackBerry’s management anticipates revenues of $132 million. Within this, revenues from IoT, Cybersecurity, and licensing and other segments are projected to be $49 million, $80 million, and $3 million, respectively.

In summary, BlackBerry’s upcoming earnings release holds promise, with the potential to surpass earnings expectations based on its recent performance. However, challenges in the Cybersecurity division and short-term headwinds in the IoT sector will be critical to watch.

Featured Image: Unsplash © Randy Lu

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