Struggling smart phone maker BlackBerry (BBRY)(BB.TO) Thursday reported a modest profit for the fourth quarter, helped by lower costs and expenses even as sales declined 36 percent from last year.
Thorsten Heins, President and CEO, said, "We have implemented numerous changes at BlackBerry over the past year and those changes have resulted in the Company returning to profitability in the fourth quarter."
Net income for the quarter was $98 million or $0.19 per share compared to a loss of $125 million or $0.24 per share last year.
Income from continuing operations was $94 million or $0.18 per share, compared to a loss from continuing operations of $118 million or $0.23 per share in the same quarter of fiscal 2012.
Excluding the impact of pre-tax charges of $29 million related to the Cost Optimization and Resource Efficiency, or CORE, program, income from continuing operations was $114 million or $0.22 per share.
Revenues for the quarter declined to $2.678 billion from $4.181 billion in the previous year.
Around 61 percent of the quarterly revenue was for hardware, 36 percent for service and 3 percent for software and other revenue. During the quarter, BlackBerry shipped about 6 million BlackBerry smartphones and 370,000 BlackBerry PlayBook tablets.
Gross margin improved to 40.1 percent from 33.5 percent, driven by higher average selling prices and hardware margins.
Cost of sales dropped to $1.60 billion from $2.78 billion while operating expenses fell to $1.087 billion from $1.535 billion, mainly due to the absence of $355 million in goodwill impairment last year.
BlackBerry plans to increase its marketing investment in the first quarter of fiscal 2014 to support the global launch of BlackBerry 10.
Including the expected 50 percent sequential increase in marketing spending, the company believes it will approach breakeven financial results in the first quarter based on its lower cost base, more efficient supply chain, and improved hardware margins.
BRBY, which closed at $14.57 on Wednesday, is losing around 3 percent in pre-market activity.
For comments and feedback: editorial@rttnews.com