BlackBerry earnings send BB stock up over 6%, what happened?

BlackBerry Ltd shares rose more than 6% in after-hours trading on Wednesday following the company's unexpected adjusted profit in its latest quarter, showcasing significant sales growth in its cybersecurity and internet-of-things (IoT) businesses.

BlackBerry earnings score big on IoT

BlackBerry's fiscal fourth quarter marked its "strongest-ever quarter" for the company's IoT division, with CEO John J. Giamatteo noting that the company also made significant strides in advancing its cybersecurity division.

Giamatteo highlighted the company's progress in separating its divisions and moving towards profitability, noting that the operating cash burn more than halved in the quarter compared to the previous quarter.

BlackBerry earnings reportcard

In terms of financial performance, BlackBerry reported a loss of $56 million, or 10 cents per share, for the quarter, a substantial improvement from the loss of $495 million, or 85 cents per share, in the same period last year.

Adjusted for one-time items, the company reported earnings of 3 cents per share, surpassing analysts' expectations of a 4-cent loss per share, according to FactSet.

Revenue for the quarter reached $173 million, up from $151 million a year ago, beating FactSet consensus estimates of $150 million. This revenue included $66 million from the IoT business, reflecting a 25% year-over-year increase, and $92 million from the cybersecurity business, marking a 5% year-over-year increase.

Once known for its iconic devices, BlackBerry has shifted its focus towards IoT, cybersecurity, and vehicle software after facing stiff competition from smartphones like Apple's iPhone. This strategic pivot has proven fruitful, as evidenced by the strong performance in these segments.

What was BlackBerry guidance?

BlackBerry provided guidance for the fiscal first quarter, expecting a per-share loss between 4 cents and 6 cents on sales ranging from $130 million to $138 million.

For FY25, the company forecasts a per-share adjusted loss between 3 cents and 7 cents on sales totaling $586 million to $616 million.

Despite the positive financial results and optimistic outlook, shares of BlackBerry have declined approximately 38% over the past year, in contrast to a 26% increase for the S&P 500.