June 19, 2014 7:45 am

BlackBerry reports $23M Q1 profit

BlackBerry CEO John Chen delivers a speech in Jakarta, Indonesia, on May 13, 2014. Achmad Ibrahim/AP Photo

WATERLOO, Ont. – BlackBerry (TSX:BB) delivered a surprise profit of $23 million during its first quarter, beating analyst expectations, as results showed that efforts to remodel the company’s smartphone business are making some headway.

The Waterloo, Ont.-based smartphone maker says the results were equal to four cents per share, compared with a loss of $84 million or 16 cents a year ago.

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On an adjusted basis, BlackBerry reported a loss of 11 cents per share, which came in above analyst estimates of a loss of 26 cents, according to Thomson Reuters.

However, revenue tumbled to $966 million for the three months ended May 31, compared with $3.07 billion a year ago.

BlackBerry will hold its annual shareholders meeting later this morning in Waterloo.

Chief executive John Chen has said he aims to make BlackBerry a break-even company by the end of the fiscal year with a target of rising to profitability in its 2016 financial year.

“Over the past six months, we have focused on improving efficiency in all aspects of our operations to drive cost reductions and margin improvement,” he said in a statement.

Chen was hired last year to reshape BlackBerry’s business model, reduce expenses and lead an effort to help the company find a better footing in the highly competitive tech sector.

On a conference call with analysts, Chen gave some insight into BlackBerry’s plans for the rest of the year.

He said the company will launch a new keyboard smartphone model called the BlackBerry Passport in September, while he also plans to hold an event the same month to showcase its new hardware lineup for next year.

BlackBerry is dedicating more resources to serving business and public sector customers after a failed attempt to compete with Apple’s iPhone and the various smartphones on the Android operating system that dominate the consumer market.

During the quarter, BlackBerry booked revenue for about 2.6 million smartphone sales, which is an increase from the revenue from 1.3 million devices a quarter earlier.

The results demonstrate that the company is “firmly on track to achieve important milestones, including our financial objectives and delivering a strong product portfolio,” Chen said.

BlackBerry also boosted its cash holdings to $3.1 billion, from $2.7 billion in the previous quarter, with the help of a tax refund and money from the recent sale of real estate assets.

BlackBerry shares were 10 per cent higher at US$9.13 in pre-market trading in New York.

© The Canadian Press, 2014

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