BlackBerry Limited said it expects revenue for the fiscal year ended February 28 to be about $656 million, which was a little below the FactSet analyst consensus of $666.8 million.
The Waterloo, Ontario-based software company specializing in cybersecurity, said it expects revenue in its Internet of Things, or IoT, unit to be up 16% year-over-year to $206 million. The firm expects cybersecurity unit revenue of about $418 million, which was below a prior outlook.
The company explained that there were some large government deals being negotiated that didn’t close during the fourth quarter, pushing them into fiscal 2024.
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BlackBerry stock fell 13% to $3.48 in pre-market trading after the news announcement, and clawed its way back into the green on Wednesday morning by trading around $3.56 on the New York Stock Exchange.
For the fiscal 4Q ended February 28, 2023, the Canadian company expects to report revenue of $151 million, with $88 million coming from the cybersecurity unit and $53 million being clocked up by the IoT unit.
The company said that its fiscal 4Q results would include a large goodwill impairment charge of up to $440 million for its Spark business.
"Macro challenges were a key factor for BlackBerry's cybersecurity business unit this quarter, with elongated sales cycles in government causing some large deals to slip into later quarters," BlackBerry CEO John Chen said in a statement.
"The IoT business unit closed the year strongly, and we expect to deliver year-over-year revenue growth of approximately 16%, in line with outlook.”
Chen noted that given the current macro backdrop, BlackBerry's management has taken “proactive steps this quarter to both balance investments and manage costs” to drive towards growth.
Contact the author Uttara Choudhury at uttara@proactiveinvestors.com
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