BlackBerry Shares Crumbled After Earnings Release

Shares of BlackBerry Ltd went falling on Friday, as much as 13% after the company released their first quarter report. The loss on Friday was the biggest one day drop for BlackBerry in over two years.

BlackBerry posted revenue on adjusted basis of $244 million for the first quarter ended May 31st. This was way below the $264.5 million that analysts according to Thomson Reuters had expected.

BlackBerry also reported earnings of 2 cents per share, excluding items, while analysts had been looking for the company to break even.

One of the key things to be attention to was that BlackBerry’s software and professional sales fell 4.7% to $101 million. Investors had been looking forward to the company posting a gain as CEO John Chen’s turnaround strategy has called for high-margin software sales.

“This is a big disappointment for the stock and likely to cast a pall on the sustainability of the turnaround,” remarked Tim Ghriskey, who is the chief investment officer with Solaris Asset Management.

CEO Chen remains optimistic. “It’s going to be a more of a second-half growth, I think,” he said on the call. According to Chen the company is encouraged that it would achieve 10 percent to 15 percent growth in software sales.

Disclaimer: We have no position in BlackBerry Ltd (NASDAQ: BBRY) and have not been compensated for this article.