BlackBerry’s turnaround is done and it’s time to grow again in 2019, CEO says

Even in its currently downscaled state, it would be hard to claim BlackBerry (BlackBerry Stock Quote, Chart TSX:BB) is short on ambition.

While the former phone-maker may yet need to prove where its top line growth is going to come from, CEO John Chen has bucketloads of faith in not only his company’s turnaround (already behind it, says Chen) but in its strong positioning within the still developing Internet of Things market.

This week, BlackBerry is marking its 35th birthday, as it was back in 1984 that Research In Motion was founded in Waterloo, Ontario, by Mike Lazaridis and Douglas Fregin. Speaking to BNN Bloomberg on Wednesday from the RSA cybersecurity conference in San Francisco, Chen said BlackBerry’s laudable history is both valuable to the company while at the same time being truly a thing of the past.

“We’re very proud of our heritage and our handset business but we’re going to move into a much more higher growth market,” said Chen. “It’s no longer a turnaround story. It’s really going to turn into a growth story.”

Like many names in the tech sector, BB has done well over the first two months of the year, rising more than 23 per cent through January and February. Ahead of the company’s fiscal fourth quarter report due later this month, BlackBerry last reported in December where it beat analysts’ estimates on both revenue and earnings, coming in with $228 million in revenue and EPS of five cents per share, better than the Street’s forecast of two cents per share.

Chen says that while there will be more details forthcoming on the company’s direction for its next fiscal year, he sees BlackBerry excelling in the cybersecurity and embedded devices spaces.

“As far as growth is concerned, I haven’t disclosed a number for next year. I just finished the fiscal year and we’re in a quiet period so I’d best not make any specific forecasts. You will hear it in our earnings call in the next four to six weeks. But it’s safe to say that we’re looking for good double-digit growth,” Chen says.

“We haven’t gotten into the general embedded market. Our footprint there is not as big as we’d like,” he says. “The medical devices area, the heavy industry area, drones and planes —there are a lot of opportunities in the embedded market for [BlackBerry platform QNX].”

For evidence of BB’s success, Chen points to last fall’s purchase of California cybersecurity firm Cylance, which at $1.4 billion constituted the largest deal in BlackBerry’s history.

“We were able to write a cash cheque for $1.4 billion. That should tell you a little about whether the turnaround is done or not,” Chen says.