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.
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.
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.