BlackBerry Is Betting Its Comeback On Cyber Security

On Wednesday, BlackBerry Limited BB posted a surprise profit for the first quarter as the cybersecurity business enjoyed higher client spending, while its enterprise IoT software is enjoying a strong momentum in the automotive sector as the architecture of EVs continues to grow in complexity. On Thursday, US-listed shares increased over 20% in pre-market trading.

First Quarter Highlights

For the quarter ended on May 31st, BlackBerry reported a surprise profit of 6 cents per share for the quarter, well above analyst expectations of a loss amounting to 5 cents per share.

Total revenue amounted to $373 million, exceeding Refinitiv’s average analyst estimate of $160.4 million. Cybersecurity expanded 5.5% sequentially, bringing in revenue of $93 million, while licensing and other services generated sales of $235 million made up mainly from proceeds from patent sale.

Hope Of A Turnaround In A Story Of Extreme Success And Extreme Failure

Shortly after going public in 1997, BlackBerry became known for its business smartphones which became a status symbol. It even got credited by many as creating the first smartphone but its flagship business got shutdown last year. Since suffering defeat from Apple Inc AAPL and Google or more precisely, iOS and Android, it has since been trying to sell its legacy patents related to its mobile devices. In March, Malikie Innovation Limited agreed to purchase its mobile device patents for approximately $900 million. Waterloo, Canada-based tech company is now undergoing a strategic turnaround, possibly separating its core business into two fields: cybersecurity and software systems.

A Comeback Opportunity From Rising Security Threats In The IT Sector

The Canadian technology company is betting its comeback on resilient demand for its cybersecurity offerings. After this high-flying revolutionary tech company got eclipsed by Apple and the iPhone which was the start of its demise, it is trying to get back on its feet with Cybersecurity and IoT. However, some find that BlackBerry’s issue goes deeper than that, because unlike Apple and Google whose systems improved over time, BlackBerry phones didn’t change that much since their debut and therefore, didn’t live up to consumer expectations that kept getting higher. Although it still has to remake its reputation after being remembered as a failed smartphone maker who got smashed by Apple and even Google, BlackBerry seems determined to rise to the cybersecurity challenge and rise again by changing its legacy with the power of AI.

DISCLAIMER: This content is for informational purposes only. It is not intended as investing advice.