TORONTO – Shares of BlackBerry (TSX:BB) moved slightly higher in early trading Friday after the troubled smartphone maker’s second-quarter financial results, although bad, were in line with the dismal estimates issued by the company last week.
The company’s shares gained 10 cents to $8.32 on the Toronto Stock Exchange shortly after trading began. In the U.S., BlackBerry shares gained nine cents to US$8.04 on the Nasdaq.
BlackBerry, which reports in U.S. currency, says it lost US$965 million in the three-month period as revenue plunged amid dismal sales of its new smartphones.
Revenue for the three-month period was US$1.6 billion, down 49 per cent from the previous quarter and 45 per cent from the second quarter of 2012.
The company recognized hardware revenue on about 3.7 million BlackBerry smartphones in the quarter, with “most” of the units being its older BlackBerry 7 devices.
BlackBerry’s cash on hand dropped to $2.6 billion as of Aug. 31, down from $3.1 billion in the previous quarter, but the Waterloo, Ont-based company continued to be essentially debt-free.
Its financial report was vague about what its cash was used for, saying the biggest chunk of it — about $268 million — went towards “intangible assets,” which is a general undefinable term for non-physical assets. Some cash also went towards its operations, about $136 million, and another $112 million was put into capital spending.
The results were largely in line with a warning issued last week by BlackBerry (TSX:BB), when it announced 4,500 jobs will be cut from its global workforce.
On a per share basis, the adjusted loss was equal to 47 cents per share compared to analyst expectations of 48 cents per share, according to a survey by Thomson Reuters
“We are very disappointed with our operational and financial results this quarter,” said chief executive Thorsten Heins in a release.
“We understand how some of the activities we are going through create uncertainty, but we remain a financially strong company with $2.6 billion in cash and no debt.”
Heins, who has scrapped his usual conference call with analysts, said BlackBerry is focused on completing its restructuring quickly in order to establish “a more focused and efficient company.”
The Waterloo, Ont.,-based firm said last week that it expected to book a loss of between US$950 million and US$995 million for the quarter.
That was followed on Monday by a conditional takeover offer for the company from Fairfax Financial Ltd. (TSX:FFH), which already owns about 10 per cent of BlackBerry’s stock.
Fairfax’s tentative offer of US$9 cash for each share values BlackBerry at about US$4.7 billion.
Since then, BlackBerry shares have fallen amid doubts that the highly conditional offer will be completed.