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BlackBerry shares boosted as first-quarter profit and revenue beat estimates on software growth

The smartphone maker has had to compete with the likes of Apple and Android devices
BlackBerry shares boosted as first-quarter profit and revenue beat estimates on software growth
BlackBerry shares were up as high as 4% in pre-market trade

BlackBerry Ltd  (NYSE:BB, TSX:BB) shares raced north in pre-market deals as growth in its software and services business led to quarterly results beating analyst estimates.

The Canadian smartphone and software pioneer revealed that its enterprise software and services business had risen 18% to US$189mln in the first quarter.

That led to revenue for the three months coming in at US$217mln versus an average of analysts’ estimates of US$211mln.

Profit, meanwhile, excluding some items, came in at US$0.03, which was far better than consensus of less than US$0.01, the Ontario-based company said in a statement Friday.

Notably, around 86% of software revenue was recurring, underscoring the core strength of the growth.

Shares in BlackBerry added 2.1% in New York to US$11.95 but were earlier 4% higher.

"I am pleased that BlackBerry QNX software is now embedded in over 120 million automobiles worldwide, doubling the install base in the last three years," noted John Chen, Blackberry's chief executive.

BlackBerry has been something of a turnaround story, bringing itself back from the brink after suffering badly amid the unprecedented popularity of Apple (NASDAQ:AAPL) smartphones and Android devices. More recently it has been focused on selling software aimed at managing mobile devices. 

In other news today, Blackberry said it had struck a cyber-security deal with British phonemaker Bullitt Group.

It is the second deal the group has inked this year after it licensed its security software to Swiss company Punkt in early March.

That deal allowed Punkt to bring to market a range of highly-secure products which will embed BlackBerry cybersecurity technology.

They will be certified as BlackBerry Secure, and be shipped ready to connect to home and enterprise networks.

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