Blackberry Raises Guidance After Strong Q3 Numbers: Is The Stock A Buy?

12/27/2024 10:10:44 AM

(MENAFN- Baystreet) BlackBerry Limited (TSX:BB)(NYSE:BB) hasn't been a great stock to own over the past five years, losing more than 40% of its value during that stretch. Last week, the company reported its most recent quarterly results, however, which did give investors some much-needed positive news.
The company delivered an impressive third quarter of fiscal 2025, exceeding revenue guidance and achieving profitability milestones ahead of schedule. BlackBerry showcased signs of progress as it continues its challenging transformation from a smartphone pioneer to a leader in cybersecurity and IoT solutions.
For the period ending Nov. 30, the company's total revenue reached $162 million, surpassing guidance for both the IoT and Cybersecurity divisions. IoT revenue grew 13% sequentially to $62 million, while Cybersecurity revenue rose 7% to $93 million.
What was perhaps even more important than the growth for investors was that BlackBerry achieved positive adjusted EBITDA of $23 million which came in better than expected. Free cash flow also came in strong at a positive $3 million (versus a negative $33 million in same period last year).
While the company raised the bottom end of its IoT guidance for fiscal 2025, BlackBerry arguably still needs to do more to demonstrate that it's on the right track. There's a lot of competition in this space and it still has a long way to go in demonstrating that it's a safe buy again.
Betting on a turnaround play can result in significant gains if things go right, but there's also the potential to incur huge losses if things don't go according to plan. Investors should continue to tread carefully with BlackBerry as its results have been choppy and inconsistent over the years; it's not a stock I'd rush out to buy today.

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