BlackBerry CEO John Chen reveals phones during the news conference for the company’s new BlackBerry Classic phone, in New York on Wednesday, Dec. 17, 2014. File photo by THE CANADIAN PRESS

BlackBerry CEO John Chen reveals phones during the news conference for the company’s new BlackBerry Classic phone, in New York on Wednesday, Dec. 17, 2014. File photo by THE CANADIAN PRESS

Ottawa’s row with China hasn’t hurt BlackBerry, CEO optimistic of resolution

TORONTO — The CEO of BlackBerry Ltd. said Thursday he hasn’t seen any indication that recent political tensions between the governments in Beijing, Ottawa and Washington are affecting the company’s long-term business prospects in China.

John Chen said he’s optimistic there will be a resolution of the diplomatic dispute that erupted after Canada arrested Chinese businesswoman Meng Wanzhou in Vancouver on Dec. 1 at the request of the United States.

“We do a lot of investments in the auto sector in China, as well as in Korea and Japan, and I will continue to do that until somebody gives me a sign that I should stop,” Chen said in an interview after BlackBerry issued third-quarter results Thursday.

In fact, Chen has been positioning BlackBerry and its QNX subsidiary to be major suppliers to the global automotive industry, through various agreements with automakers, Tier 1 parts suppliers and chip manufacturers.

Included in its pipeline of projects is an agreement to design BlackBerry software into the Apollo operating system for self-driving vehicles, which is being developed by Chinese search-engine giant Baidu.

“They’re (trying) to sell these platforms to car manufacturers, especially in China. And they’d like to make it more of a standard around the world, obviously. And we’d like to help them too,” Chen said.

But revenue from the Apollo project won’t begin to flow to BlackBerry until it’s built into vehicles and the manufacturers begin to pay royalties on the licensed intellectual property.

“That’s the nature of this particular business,” Chen told analysts in an earlier conference call.

“The good thing is … once you’ve started revenue coming, the flow is not only predictable and ramping slightly over the life cycle, it’s a long flow.”

He said that BlackBerry is beginning to see the positive impact of design wins that the company announced two to three years ago, and that there’ll likely be another step upward in about a year after later royalty agreements start to pay off.

It is also getting new and repeat business from several key U.S. government customers, including contracts signed in the third quarter by the Defence Intelligence Agency, Federal Emergency Management Agency (FEMA), Internal Revenue Services (IRS), Transportation Security Administration (TSA), the U.S. Air Force and the U.S. Marine Corps.

The Waterloo, Ont.-based technology company beat analyst estimates for the financial quarter ended Nov. 30,

It earned US$59 million in net income for the quarter ended Nov. 30, up from a loss of US$275 million in the same quarter last year.

The profit, which BlackBerry reports in U.S. currency, amounted to 11 cents per basic share for the most recent quarter compared with a loss of 52 cents per share a year ago.

The company’s adjusted profit for the quarter ended Nov. 30 was five cents per share, up from three cents last year.

Revenue totalled $226 million, which was even with last year’s third quarter and up from $210 million in the second quarter this year.

Analysts on average had expected an adjusted profit of two cents per share and revenue of $212.5 million, according to Thomson Reuters Eikon.

Software and services accounted for $217 million of revenue, up from $190 million a year ago, while handheld device sales — which have been declining for years — contributed no revenue in this year’s third quarter.

BlackBerry shares closed up at C$10.22 at the Toronto Stock Exchange, up 29 cents for the day but below the day’s high of $10.82. On the New York Stock Exchange, which sees higher volumes of trading in the stock, BlackBerry closed at US$7.55, up 20 cents but off the day’s high of US$8.04.

Several analysts have said they are waiting for BlackBerry revenue to begin increasing on the strength of its newer business ventures. Some have suggested BlackBerry’s US$1.4-billion acquisition of Cylance, a U.S. artificial intelligence and cybersecurity firm, may help revenue in the long term but the deal isn’t expected to close until February.

The transaction has recently passed one of the key regulatory hurdles, under the U.S. Hart-Scott-Rodino anti-trust act, and Chen said Thursday that BlackBerry will now have more freedom to discuss Cylance with customers.

“These cybersecurity capabilities will fit nicely with everything we do,” Chen said.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

SARS-CoV-2 virus particles, which causes COVID-19, emerge from the surface of cells isolated from a patient in the U.S. and cultured in a lab in a 2020 electron microscope image. THE CANADIAN PRESS/AP-HO, National Institute of Allergy and Infectious Diseases - Rocky Mountain Laboratories
Alberta adds 463 new COVID-19 cases on Sunday

The central zone has 818 active cases

Red Deer teacher Janelle Van Tetering had her students write letters to attach to Blankets of Hope, which will be donated to the Mustard Seed. (Contributed photo)
Red Deer teacher, students donate ‘Blankets of Hope’ to those in need

A Red Deer teacher and her students are giving warm blankets and… Continue reading

RCMP have charged a Sylvan Lake man for allegedly defrauding five people of more than $100,000.
Advocate file photo
20-year-old woman killed in collision: Blackfalds RCMP

A 20-year-old woman was killed in a collision on Saturday, says Blackfalds… Continue reading

Patrick Malkin, co-owner of The Granary Kitchen, says he wants the provincial government to lift COVID-19 restrictions that shutdown in-person dining. (File photo by Advocate staff)
Red Deer restaurant owner ‘frustrated’ in-person dining restrictions are still in place

Dr. Deena Hinshaw announced the restrictions won’t yet be eased this past Thursday

As of Friday, Alberta has under 10,000 active COVID-19 cases. (Image courtesy CDC)
Alberta identifies 573 new COVID-19 cases, 13 deaths on Saturday

There are currently 9,727 active cases of the virus in the province

Terrance Josephson of the Princeton Posse, at left, and Tyson Conroy of the Summerland Steam clash during a Junior B hockey game at the Summerland Arena in the early spring of 2020. (John Arendt - Summerland Review)
QUIZ: How much do you know about hockey?

Test your knowledge of Canada’s national winter sport

Toronto Maple Leafs' Alexander Kerfoot, centre, tries to get the puck past Calgary Flames goalie Jacob Markstrom, right, as Noah Hanifin looks on during first period NHL hockey action in Calgary, Sunday, Jan. 24, 2021.THE CANADIAN PRESS/Jeff McIntosh
Morgan Reilly’s three assists lifts Maple Leafs to 3-2 win over Flames

Leafs 3 Flames 2 CALGARY — Morgan Reilly’s three assists helped the… Continue reading

Green Bay Packers' Adrian Amos (31) reacts after intercepting a pass intended for Tampa Bay Buccaneers' Mike Evans during the second half of the NFC championship NFL football game in Green Bay, Wis., Sunday, Jan. 24, 2021. (AP Photo/Jeffrey Phelps)
Road warriors: Bucs win 31-26 at Green Bay, reach Super Bowl

GREEN BAY, Wis. — Tom Brady and the Tampa Bay Buccaneers’ road… Continue reading

People arrive to be tested for COVID-19 at a clinic in Montreal, Sunday, January 24, 2021, as the COVID-19 pandemic continues in Canada and around the world. THE CANADIAN PRESS/Graham Hughes
Too soon to know if Canada’s COVID-19 case decline will continue, Tam says

MONTREAL — It’s still too soon to know whether the recent downward… Continue reading

Flowers are seen at the front door of Dr. Denis Vincent's dental practice in North Vancouver, B.C. on March 31, 2020, after he died of COVID-19. The British Columbia Dental Association has written a letter to Premier John Horgan urging him to include dentists in a priority group for the COVID-19 vaccine. THE CANADIAN PRESS/Jonathan Hayward
Dentists, teachers disappointed they won’t be prioritized for vaccine in B.C.

VANCOUVER — Dentists and teachers are among the groups that are disappointed… Continue reading

Indiana Pacers guard Justin Holiday (8) shoots over Toronto Raptors forward DeAndre' Bembry (95) during the first half of an NBA basketball game in Indianapolis, Sunday, Jan. 24, 2021. (AP Photo/Michael Conroy)
Anunoby’s hot hand helps short-handed Raptors beat Pacers

Raptors 107 Pacers 102 INDIANAPOLIS — OG Anunoby scored a season-high 30… Continue reading

A woman injects herself with crack cocaine at a supervised consumption site Friday, Jan. 22, 2021 in Ottawa. THE CANADIAN PRESS/Adrian Wyld
Drug users at greater risk of dying as services scale back in second wave of COVID-19

OTTAWA — Under fluorescent lights, Wendy Muckle surveys the supervised consumption site… Continue reading

The Canada Revenue Agency (CRA) headquarters Connaught Building is pictured in Ottawa on Monday, Aug. 17, 2020. nbsp; THE CANADIAN PRESS/Sean Kilpatrick
Taxpayers’ watchdog sees complaints spike, raising worries about pandemic tax season

OTTAWA — Canada’s taxpayers’ ombudsperson says his office has seen a steep… Continue reading

Most Read