BlackBerry, listed on the NYSE under the 'BB' ticker, declined by 12% after the release of the below-expectations Q2 report.
As per the analysts, the Q2 revenue for the BlackBerry was expected to be around $150.5 billion. However, the data released by BlackBerry showed around $132 million worth of sales only.
A closer look at BB's earnings reports suggests the company will earn $49 million from the IoT unit. Overall, it represents a sequential growth of around 9% when compared with Q1. Similarly, the earnings from the cybersecurity department are forecasted to be $80 million which also happens to be a lot lower than the expectations.
According to BlackBerry, the major reason why the company's results are not up to expectations is not being able to close major government deals.
BlackBerry Expects To Earn $225-$250 Million From IoT
For the most part, BlackBerry kept the revenue forecast for the licensing and the cybersecurity unit intact. However, the revenue forecast for the IoT department was revised lower to more realistic targets. The company expects to earn close to $225 million - $240 million from its IoT business this year.
BlackBerry's CEO said that the cybersecurity department of the company is going through a sales cycle. At the same time, the company also continues to enjoy a strong position thanks to the government deals. They also added that the impact on the revenue in Q2 can be attributed to the delay in big deals.
BlackBerry is expected to close most of these deals before the end of the fiscal year 2023. In addition, there are also a lot of opportunities for the company to explore in the IoT sector alone.
That's why the BlackBerry believes that it only needs to readjust the short-term goals. However, the long-term goals will remain intact without any need for revison.
After the release of the recent forecasts by the BlackBerry, the investors didn't like what they saw at all. That's why the stock experiencing quick selling which sent it 12% lower.