Komatsu Global KMG BlackBerry Beats Global Expectations.

Online, August 10, 2014 (Newswire.com) - Komatsu Global - KMG - BlackBerry, the struggling smartphone handset maker and software services company, has surprised investors by posting a profit for the first time in several quarters.

Although the profit owed more to accounting adjustments than a searing pace of revenue growth, it was supported by a far better-than-expected decline in revenue compared with the catastrophic near-$1 billion fall in the previous quarter.

“Clearly, the severe cost-cutting and efforts to refocus the business have served to stop the bleeding,” said a Komatsu Global technology sector researcher. “They’re not saying by any means that they’ve turned the company around but this shows that, with hard work and by making the tough decisions, it is possible to put a company, even one which looked as bad as BlackBerry, on the road to recovery,” he continued.

Big questions, however, remain over the company’s smartphone business. Although it sold 1.6 million handsets in the current quarter against 1.3 in the previous, there are strong headwinds facing any concerted effort to re-establish position in developed markets, not least of which is the decision by some mobile carriers to stop or reduce the BlackBerry models they offer to customers.

“BlackBerry has a tie-up with Foxconn, makers of the iPhone, to jointly develop and produce their low-cost Z3 phone in Indonesia, a country in which BlackBerrys were particular popular but John Chen, the company’s CEO, believes that the future lies in selling services primarily to businesses and governments,” said the Komatsu Global KMG researcher.

BlackBerry’s BBM – its secure messaging software – has been opened up to users of Android and iPhones but the company has not officially demonstrated how it will capitalize on having more users.

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