At one time, Blackberry owned the smartphone market. There was nowhere you could go without seeing someone with their “CrackBerry” typing away on their QWERTY keyboard while the rest of us labored to create short text messages on our regular old phones.
But then the smart phone revolution happened. Apple unveiled the iPhone, and the first phones operating on the Android operating system came out.
“As Apple and Google emerged as competitors, we didn’t move quickly enough, and we lost our lead,” admitted BlackBerry Chief Financial Officer Steve Capelli in a blog post.
A ‘turnaround CEO’
The company brought in John Chen, known as a successful turnaround CEO. He developed a strategy in which the company capitalized on its software portfolio, which is known for its high security and mobility standards, and farmed out production of BlackBerry phones to other companies.
The company’s recovery strategy included taking advantage of its BlackBerry Secure software platform and deploying it to other products; pivoting to take advantage of the company’s expertise in mobility and security and deploy it in cybersecurity, automotive, and the Enterprise of Things; and licensing its brand to third-party manufacturers who build, market, and distribute BlackBerry phones.
In doing so, Chen wrote, BlackBerry has remade itself into a software company and is “leveraging [its] worldwide mobile security brand to achieve [its] new mission to secure the Enterprise of Things.”
Almost a year later, is the turnaround complete? Many are now saying yes.
BlackBerry stock is up more than 75 percent this year. The company reported on December 20 that its gross margins reached a record high of 77 percent in the quarter.
Becoming a bigger player in IoT
The company has increased its efforts to make its QNX software unit a bigger player in the automotive and Internet of Things business. QNX now powers the Sync 3 smart entertainment and navigation systems in Ford cars. It also has deals with auto parts suppliers including Bosch, Magna, and Denso (the largest supplier to Toyota).
It also signed deals to manage enterprise software for clients including the U.S. Department of Defense, the U.S. Department of Justice, Deutsche Bank, and NATO.
In another interesting turn of events, in September 2017, BlackBerry announced a patent licensing deal with Timex, in which Timex pays royalties to BlakcBerry and possibly develops a smartwatch running on BlackBerry’s IoT technology.
On the other hand, the company’s revenue fell to $226 million in the three months ended Nov. 30, 2017, a 21.8 percent decrease from the same period in 2016.
A positive time
Regardless, all signs seem to be pointing to a very positive time for BlackBerry.
“Our strategy is working and our execution is yielding results,” Chen said in a statement. “We are a market leader in secure endpoint management and embedded software. The validation we have received, from partners, customers, and industry experts around the world, speaks for itself.”
Photo: The BlackBerry banner hangs on the front of the New York Stock Exchange building on October 16, 2017. Credit: Christopher Penler / Shutterstock.com