BlackBerry Ltd (NYSE: BB) dropped in pre trading session on Wednesday after the company stated that its cybersecurity software’s sales cycles have gotten lengthier and that it anticipates the current macroeconomic situation to provide further difficulties in the near future.
The Canadian technology corporation predicted that income from the cybersecurity sector will remain steady in 2023’s first half but increase in the second.
Businesses in the cybersecurity industry have not been as impacted by economic changes as other software industries, which are battling clients’ decreased spending budgets while facing growing expenses.
According to BlackBerry CEO John Chen, there is indications that investments will propel growth next year and that the cybersecurity industry is recovering pace.
The segment’s revenue dropped by nearly 17% to $106 million in the third quarter. The company’s U.S.-listed shares decreased slightly in extended trade. So far this year, they have decreased by around 56%.
The market for electric vehicles is expanding, and linked cars and other safety technologies are becoming more popular. These factors helped BlackBerry’s automotive and embedded technology solutions sell better.
Sales of BlackBerry’s QNX automotive software product, which is a part of the Internet of Things (IoT) segment, increased by nearly 19% to $51 million during the quarter under review.
This year, the business anticipates the category to rise by 15% to 18%. The market for its QNX automotive software remained robust in China and India, the firm claimed, despite some tightening in the North American and European car sectors.
In comparison to a profit of $74 million a year earlier, BlackBerry recorded a net loss of $4 million for the three months that ended on November 30. From $184 million to $169 million in revenue, an 8.2% decrease. According to IBES statistics from Refinitiv, analysts had projected revenue of $168.7 million on average.
Executive Chairman & CEO, BlackBerry, John Chen stated that Both of BlackBerry’s business units had strong success this quarter, according to reports. Their IoT business is growing quickly and set a record for design-phase revenue in the most recent quarter. This success was mostly due to design wins in the general embedded market and the car industry’s core safety-critical market. Additionally, the quarter saw considerable product development, including the important revelation that QNX will be made available in the cloud through AWS.
He added, following product demonstrations at both Bosch Connected World and AWS’s re:Invent conference throughout the quarter, BlackBerry IVY is moving forward successfully with strong engagement. The rebuilding process in our cybersecurity industry is gaining traction. Churn improved and there was more proof that investments in go-to-market and the product portfolio will lead to additional sequential gains and progress towards a return to ARR growth next fiscal year, in accordance with the strategy described last quarter.
