BlackBerry Ltd. shares were having one of their best days in months on Wednesday after the technology company reported better financial results than expected.
At mid-day, BlackBerry shares were just a few cents below a new 52-week high of $15.87 set earlier in the day after the Waterloo-based company announced an unexpected adjusted net profit and revenue above analyst estimates.
Executive chairman John Chen also said BlackBerry is making good progress towards being a key software supplier for autonomous vehicles, which he sees as a one of the key growth opportunities for the former smartphone company.
The Waterloo, Ont.-based company -- which has been repositioning itself as a cybersecurity, software, and intellectual property supplier -- is working with many of the automotive industry's major chip makers and parts suppliers.
"They have engaged us to provide them a BlackBerry operating system for the car that is high on safety and security," Chen said in an interview Wednesday.
He said a modern car has far more lines of code than an airplane, even a fighter jet, so BlackBerry is focused on embedding its technology in the most basic systems of a vehicle's functions.
BlackBerry has developed about 12 different software modules beyond infotainment systems that were a major part of its QNX operating unit.
For example, BlackBerry has modules for guiding lane changes with advanced driver assistance, for connecting the vehicle to wireless networks, and for showing how various systems are working through virtual cockpit displays.
"These are all high-growth areas, they're all new. It's more needed for the autonomous car than the connected car," Chen said.
But the recent agreements with chips makers and automotive systems suppliers won't have an immediate impact on BlackBerry's revenue, which continued to dwindle in the third quarter ended Nov. 30.
"Some of the design wins we had last year will turn into revenue in 2019 and the wins that we are having right now are going to turn into (revenue) in 2020," Chen told analysts.
Last week, BlackBerry announced a partnership with Japan-based Denso Corp. -- one of Toyota's technology suppliers -- to work with Intel to develop an integrated platform for co-ordinating various human-machine interfaces.
In BlackBerry Ltd.'s most recent quarter ended Nov. 30, it lost US$275 million under U.S. generally accepted accounting principles.
The loss, reported in U.S. currency, included $149 million in expenses after BlackBerry lost an arbitration of a dispute with Nokia.
However, BlackBerry said its adjusted profit, excluding the Nokia payments and other items, was $16 million or three cents per share.
Analysts on average had expected a break-even quarter on an adjusted earnings-per-share basis, according to Thomson Reuters.
BlackBerry's revenue was also higher than expected at $226 million -- compared with an average estimate of $214.6 million -- but down from $289 million a year ago.
Revenue from handheld devices dropped to $9 million, from $62 million, and revenue from system access fees dropped to $27 million from $67 million.
Revenue from software, services and licensing was $190 million, a record for the company, and up from $160 million last year.