BlackBerry reports $207M US loss in 2nd quarter

BlackBerry reporteda $207-million US loss for the second quarter, much better than analysts were expecting, despite a $50-million drop in revenues.

The second-quarter earnings report was released after the company's officiallaunch earlier this week of the Passport,a keyboardsmartphonewith a4.5-inch screenaimed at corporate users.

Despite being headquartered in Canada, BlackBerry reports its earnings in U.S. dollars. On a per-share basis, the quarterly loss for the Waterloo, Ont.-basedsmartphonemakerworks out to 39 cents per share.

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But when certain one-time items related to the company's restructuring process are stripped out, the loss narrows to two cents a share, or $11 million. That's much better than the loss of 16cents pershare that analysts who cover the company were expecting.

BlackBerry's $207-million loss is almost 80 per cent less than the loss figure it posted this time last year, a $965-million loss, or $1.84 per share.

Also Friday, the company reportedrevenues of $916 million, a drop from $966 million in the previous quarter.

The company had about the same amount of cash on hand as it did in the previous quarter, with a slight uptick of $11 million to $3.1 billion.

CEO John Chen, in a BlackBerry release, called it a "solid quarter,"and predicted the company would break even on cash flow by the end of this fiscal year, and would be profitable during the following fiscal year.

Investors appeared to agree, with BlackBerry shares gaining seven per cent on the Toronto Stock Exchange early Friday. The stock closed up five per cent at $11.44.

On a conference call with analysts to discuss the numbers, Chen said BlackBerry has sold 200,000 Passport phones since the model was launched on Wednesday.

Chen says the company has already sold enoughsmartphonesto make the device profitable. The Passport sold out in six hours onBlackBerryswebsite in Canada and the U.S. and within 10 hours on Amazon.com.

Moving away from hardware

But the numbers show that the company's revenues are increasingly coming from services and software products, not smartphone devices themselves.

BlackBerry reported 46 per cent of its revenue came wasfrom hardware, 46 per cent fromservices and eightper cent from software.

The number of BlackBerry Messenger users isalso on the rise. In the second quarter, there were 91 million monthly active users, an increase of 85 million in the previousquarter.

The company's EZ Pass Program issued almost three times as many licences for BlackBerry Enterprise Server10 this quarter over the last one, at about 3.4 million. The enterprise system allows corporate users to manage all their devices on the same systemacross operating systems including BlackBerry, Android and iOS, as well as across devices from desktop computers to smartphones.

A growing share of the company's revenue is coming from North America:32.4 per cent this quarter versus26.3per cent in the same quarter last year, and the highest inthe last five quarters.

The second quarter also saw the creation of the BlackBerryTechnology Solutions Unit, focusing on software and the company's Internet of Things strategy which refers to the new generation of internet-connected devices such as thermostats, televisions, fridges and cameras that can be controlled remotely via mobile devices such as smartphones.