(Bloomberg) -- BlackBerry Ltd. jumped the most in six months after fourth-quarter results surpassed analysts’ estimates, boosted by strong gains in licensing revenue.
The former phone maker reported sales of $99 million from its segment that distributes licenses for its existing patents to other businesses. That was a 71 percent increase over the previous year and helped boost total revenue 8 percent on an adjusted basis to $257 million. Shares surged as much as 16 percent to $10.27.
Software and services revenue, a key growth metric, hit a record $248 million on an adjusted basis, according to a statement Friday. That’s up 14 percent from a year earlier.Under Chief Executive Officer John Chen, BlackBerry left its phone-making days behind, pegging its new identity to security software. The company offers a range of different product lines, such as systems to manage an entire stable of mobile phones, or to let cars securely update their entertainment systems.The Waterloo, Ontario-based company expects revenue to grow between 23 percent and 27 percent in fiscal year 2020, driven by a double-digit increase in billings, Chen said on the earnings call. BlackBerry’s BTS segment, which includes its autonomous vehicle technology, is set to grow faster than the company’s content management software business, according to Chen. "Everybody’s interested in creating connected vehicles or autonomous vehicles or self-driving vehicles -- and it’s not only cars. It parallels efforts going on in trucks and planes and drones," he said in an interview. So while content management is a more stable market, with "the autonomous side of the equation, the market is just taking off."
BlackBerry closed its $1.4 billion purchase of cybersecurity company Cylance Inc. in the quarter. Chen expects that the acquisition will begin adding to the bottom line after the next 12 months.The company recently secured $30 million from the Canadian government to put toward autonomous car research. BlackBerry has plans to hire 800 people for the project. Read the statement here.
To contact the reporter on this story: Krista Gmelich in New York at email@example.com
To contact the editors responsible for this story: Jillian Ward at firstname.lastname@example.org, Molly Schuetz, Lisa Wolfson
For more articles like this, please visit us at bloomberg.com
©2019 Bloomberg L.P.