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BlackBerry Counts On Security Features

Posted on Tuesday, Dec 2nd 2014

BlackBerry’s turnaround remained elusive during the last quarter. The company’s financial results weren’t particularly impressive. However, they continued to upgrade products and services and remained focused on their core area of mobile security services, hoping that the efforts will pay off soon.

BlackBerry’s Financials
BlackBerry’s (NASDAQ: BBRY) second quarter revenues fell 42% over the year to $916 million, falling short of the market’s projections of $951 million. Loss per share of $0.02 was significantly better than the Street’s estimated loss of $0.15 per share.

During the quarter, BlackBerry sold over 2.4 million smartphones compared with 2.6 million units sold in the previous quarter. Hardware and services revenues amounted to 46% of the quarter’s revenues each and the remaining 8% revenues were from Software and other sources. By region, revenues from North America accounted for 32% of the quarter’s revenues while EMEA accounted for 40%. Latin America brought in 12% revenues and Asia Pacific generated the remaining 15% revenues in the quarter.

BlackBerry does not provide a detailed future outlook. But they are projecting a cash flow break even by the end of the current year.

BlackBerry’s Passport
As part of their new product releases, BlackBerry recently released the much awaited Passport smartphone to mixed reviews. The phone is “odd looking” with a 4.5 inch square screen and features both a touch screen and a physical keypad. Unlike other models that display 40 characters, the Passport will display 60 characters in a single line. It also has a 30-hour battery life along with 3GB of RAM and 32GB of storage space. It is being sold in the US through A&T and Amazon for $599 apiece. BlackBerry sold 200,000 units of the phone within two days of its release. They continue to promote the phone and are now offering as much as $550 to iPhone users to trade up to the Passport.

BlackBerry Focuses on Security
BlackBerry is focusing their efforts on further enhancing their security services. As part of this effort, they recently tied up with Samsung in a deal that will let both companies sell each other’s mobile security products. Together, the companies will work to improve Android security with the BlackBerry Enterprise Service 12 server, which manages enterprise mobile devices running on Android, iOS, Windows Phone, and BlackBerry’s mobile operating system. By the beginning of 2015, Samsung will integrate the Enterprise Server’s end-to-end encryption service into their KNOX software to add another security layer to Android devices.

They also released two identity and access solutions: Enterprise Identity by BlackBerry and VPN Authentication by BlackBerry. Focused on enterprise security, these offerings will provide employees with the right access to the right resources. The Enterprise Identity service will also simplify management of cloud-based services, including access to SaaS and internal applications. The VPN Authentication service will provide employees with secure access to use their iOS, Android, or BlackBerry smartphones through a two-factor authentication while eliminating the need for the use of hardware tokens, PINs, and passwords.

Last quarter, they also announced the acquisition of German mobile security company Secusmart for an estimated $9 million. Secusmart is known for their anti-eavesdropping technology that encrypts voice and data communication to deliver secure text, emails, and voice communication. BlackBerry plans to integrate the software in their devices following the acquisition.

BlackBerry’s stock is trading at $10.28 with a market capitalization of $5.35 billion. It touched a 52-week high of $12.54 in November last year.

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