BlackBerry Q4 better than expected; 1M BlackBerry Z10 devices shipped

BlackBerry Q4 better than expected; 1M BlackBerry Z10 devices shipped

Summary: The smartphone maker, surprisingly, reports good bottom line results for its fiscal fourth quarter. Key takeaway: the firm is far from dead yet but its rehabilitation back into the smartphone market will be slow, difficult and it will face continued challenges ahead.

SHARE:
TOPICS: BlackBerry
10

Update: an earlier version of this post erroneously said in the headline that 1 million BlackBerry Z10's were sold. They were shipped, not sold.

After much chest pumping and feather fluffing from the Canadian smartphone maker in recent weeks — taking on Samsung's enterprise plans and calling Apple's iPhone user interface old (though at least he said it "with all due respect" in true polite Canadian style) — BlackBerry has completed an early-stage turnaround with its latest financial earnings.

BlackBerry reported fourth-quarter revenue of $2.7 billion, or 22 cents a share. Profit stood at $98 million. Wall Street was expecting of 29 cents per share on revenue of $2.84 billion. 

While the expectations were low and the top line numbers are far from great, the bottom line fared much better than expected.

It comes just one week after the launch of the smartphone maker's latest device, the BlackBerry Z10, was marred by "disappointing sales" according to analysts. That said, BlackBerry has improved its overall margins with its new Z10 device that has helped spin the company back around into profitability for the quarter, giving the firm extra room to breathe to release upcoming devices.

By the numbers:

  • 6 million smartphones shipped during the fourth quarter, including 1 million BlackBerry 10 units;
  • 370,000 BlackBerry PlayBook tablets shipped during the same quarter;
  • 76 million BlackBerry users in total worldwide, down by 3 million;
  • 1 million subscribers lost quarter-over-quarter.

BlackBerry, formerly known as Research in Motion, also noted that it ended the quarter with $2.9 billion in cash and equivalents, a $800 million increase from the previous quarter and 38 percent more than the same time a year ago.

For the fiscal year, revenue was $11.1 billion, down 40 percent year-over-year from $18.4 billion. BlackBerry reported an adjusted net loss from continuing operations for fiscal 2013 was $317 million, or $0.60 per share.

Screen Shot 2013-03-28 at 07.27.30
BlackBerry's balance sheet for Q4/FY2012 (Credit: BlackBerry)

BlackBerry chief executive Thorsten Heins said the changes the company has made have resulted in the company's "return to profitability" for the fourth quarter. Heins elaborated in prepared remarks: 

As we go into our new fiscal year, we are excited with the opportunities for the BlackBerry 10 platform, and the commitments we are seeing from our global developers and partners.

We are also excited about the new, dynamic culture at BlackBerry, where we are laser-focused on continuing to drive efficiency and improve the Company's profitability while driving innovation. We have built an engine that is able to drive improved financial performance at lower volumes, which should allow us to generate additional benefits from higher volumes in the future.

Since the last earnings call in late December when the firm's share price plummeted on the Nasdaq by more than 20 percent, BlackBerry's share price has been bumpy but surpassed its third-quarter highs of $14 per share. At its closing share price yesterday of $14.57, BlackBerry is currently no better or worse off than at the same time last year, almost exactly to the day.

BlackBerry was trading up by more than 8 percent in premarket trading by 7:30 a.m. ET, but it was short lived. By 7:50 a.m. ET, it fell below yesterday's closing price before leveling out for market open.

Screen Shot 2013-03-28 at 07.53.01
$BBRY jumps then falls in pre-market trading on the morning of its Q4 earnings (Credit: Google)

Looking ahead, the smartphone maker said it will continue to increase its marketing investment for the coming first quarter of fiscal 2014. The firm noted that it believes it will announce break-even financial results in the coming quarter based on its lower cost base, more efficient supply chain, and improved hardware margins

BlackBerry's earnings call is scheduled at 8 a.m. ET, and we'll add updates accordingly.

Topic: BlackBerry

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

10 comments
Log in or register to join the discussion
  • Explain, please

    "BlackBerry reported a fourth-quarter loss of $2.7 billion, or 22 cents a share. Profit stood at $98 million."
    gfeier
    • Corrected

      Apologies; should've said "revenue."
      zwhittaker
      • Author's presentation sucks!

        "BlackBerry reported fourth-quarter revenue of $2.7 billion, or 22 cents a share. Profit stood at $98 million. Wall Street was expecting of 29 cents per share on revenue of $2.84 billion. " What is Wall Street expecting? Is it 29 cents earning per share or 29 cents loss per share ? Just clarifying. Also, if you are publishing an Income Statement, don't call it a Balance Sheet.
        Kp Cruz
  • Wait didn't we hear that they sold 1M to one unnamed partner? So then no

    one else bought any? That's not a good sign for BB. Seems they may be in for quite a quarter over quarter drop off.
    Johnny Vegas
    • Read carefully dude...

      this financial report is only for Q4 ending March 2nd, the order for 1M units came after that and it was just an PO not actual sales yet. The 1M units is to be delivered over time. This report only represents less than a month of Z10 sales so if you actually extrapolate that would be 3M units for a full quarter and that doesn't include any US sales.
      On another note, since when does ZDNet report detailed financial results? Seems to me there's a bit of BlackBerry bias going on here. Are there articles about the $260 crash in Apple's stock since October? Why is a dude with a criminology degree writing about financial results? ...
      Buzz88
    • All the haters here will now say that they did ship a million units

      But not to end users, so they are really sitting on a shelf someplace collecting dust.
      Challenger R/T
  • Negative spin on earnings per share

    Funny how you spun a positive into a negative.
    "Wall Street was expecting of 29 cents per share" should have been
    "Wall Street was expecting of -29 cents per share" or "Wall Street was expecting a loss of 29 cents per share". The wording "BlackBerry reported...22 cents a share. Wall Street was expecting of 29 cents per share" makes it appear as though BBRY missed earnings by 7 cents per share! There's also no mention of the net positive cash flow and to me, cash is king!
    levant.tinaz@...
  • Negative spin on earnings per share

    Funny how you spun a positive into a negative.
    "Wall Street was expecting of 29 cents per share" should have been
    "Wall Street was expecting of -29 cents per share" or "Wall Street was expecting a loss of 29 cents per share". The wording "BlackBerry reported...22 cents a share. Wall Street was expecting of 29 cents per share" makes it appear as though BBRY missed earnings by 7 cents per share! There's also no mention of the net positive cash flow and to me, cash is king!
    levant.tinaz@...
  • Z10...

    This new Z10 has some pretty neat features I wasn't aware of. I found this video on a forum http://lootspace.com/news/?p=119 which showed 5 of the new hidden functions of the phone. I think this wasn't released anywhere else. You can skip to about 2 and a half minutes, because that's where it begins.
    Billie Joyner
  • Expected "profit"

    "BlackBerry reported fourth-quarter revenue of $2.7 billion, or 22 cents a share. Profit stood at $98 million. Wall Street was expecting of 29 cents per share on revenue of $2.84 billion. "

    I seem to recall that analysts were expecting a "loss" of 29 cents per share (34 cents according to the Globe and Mail or 30 cents according to Market Watch). The big shock was that they reported break even on operations and a profit due to sorting out some income tax issues and other one time restructuring activities.

    Also that's not the Balance Sheet you are showing; it's the Income Statement for Q4/FY13 )(yes, FY13).
    jim.courtney@...