The margins are anticipated to increase driven primarily by Licensing and Cylance despite declines in Other and Internet of Things. The company could experience an increase in operating expenses due to costs associated with a direct IP licensing arrangement and higher salaries and benefits expenses.
Analysts expect the company’s earnings to drop by 60% to $0.02 per share while revenue will jump by 22% to $275.73 million for the third quarter. The company has surprised investors by beating analysts’ expectations thrice in the past four quarters. The majority of the analysts recommended a “hold” rating with an average price target of $7.65.
Read: Adobe Q4 earnings review
For the second quarter, BlackBerry slipped to a loss from a profit last year due to acquired intangible amortization expense, stock compensation expense as well as acquisition and integration charges. Total revenue grew by 16% year-over-year backed by higher licensing revenue.
For the full year 2020, the company expects adjusted revenue growth in the range of 23% to 25%, driven by a double-digit percentage increase in billings year-over-year and adjusted profitability. Adjusted Internet of Things revenue is now expected to be lower than the previous growth forecast of 12% to 16% in fiscal 2020.
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