BlackBerry makes $137m from software, technology licensing in 3 months
By Kokumo Goodie, Lagos, Nigeria
Global leader in mobile communications, BlackBerry Limited this week reported its financial results for the three months ended May 3 this year, earning a total of $137 million from software and technology licensing revenue, a 150 per cent increase over its first quarter result.
According to the financial statement made available to biztechafrica.com yesterday, the Waterloo, Canada-based original equipment manufacturer (OEM) also posted $123million in what it described as its “positive free cash flow” in the quarter, adding that cash and investments balance of $3.32 billion at the end of the fiscal quarter was also achieved, marking an increase of $50 million over its fourth quarter financial year
It reported an adjusted earnings before interest, taxes, depreciation, and amortization (commonly abbreviated (EBITDA) of $157 million, a five per cent increase over first quarter this year, adding that the firm also acquired WatchDox, a leader in high-security document synchronization, sharing and management; launched the BlackBerry Leap in April, with availability in 22 markets; entered into joint development deals with Wistron and Compal for devices, in addition to the Company’s existing partnership with Foxconn.
It said revenue for the first quarter of this year was $658 million. The revenue breakdown for the quarter was approximately 40 per cent for hardware, 38 per cent for services and 21 per cent for software and technology licensing. BlackBerry had 2,600 enterprise customer wins in the quarter. Approximately 45 per cent of the licenses associated with these deals are cross-platform. During the first quarter, the Company recognized hardware revenue on approximately 1.1 million
Total cash, cash equivalents, short-term and long-term investments was $3.32 billion as of May 30, 2015. The cash balance increased $50 million in the first quarter. Excluding $1.25 billion in the face value of its debt, the net cash balance at the end of the quarter was $2.07 billion. Purchase orders with contract manufacturers totaled approximately $238 million at the end of the first quarter, compared to $394 million at the end of the fourth quarter. Operating cash flow was $134 million with free cash flow (operating cash flow minus capital expenditures) of $123 million.
In Q1, BlackBerry completed its acquisition of WatchDox, a leading provider of secure enterprise file-sync-and-share (EFSS) solutions that allows users to protect, share and work with their files on Android, iOS, Windows Phone,
BlackBerry and PCs. WatchDox will be integrated into BlackBerry’s BES12 Enterprise Mobility Management solution, extending the company’s ability to secure communications end-to-end from voice, text, messaging and data to now include documents.
In addition to BlackBerry’s existing partnership with Foxconn, the company also entered into joint development and manufacturing agreements with Wistron Corporation and Compal Electronics. These agreements will reduce the time to market of new devices, streamline the supply chain, leverage greater economies of scale and enable resource and fixed asset reductions for greater business efficiency – which are all significant steps toward BlackBerry achieving profitability in its devices business.
Its Executive Chairman and CEO John Chen said: “I am pleased with the strong performance of our software and technology business. This is key to BlackBerry’s future growth. Our financials reflect increased investments to sales and customer support for our software business. In addition, we are taking steps to make the handset business profitable. We believe these actions are prudent and necessary to grow the business and we believe the remaining milestones in our strategic plan are achievable.”