Shares of BlackBerry (TSX:BB)(NYSE:BB) fell more than 15% on Friday after the company's earnings report underwhelmed investors. The big problem was that the company's revenue of $218 million U.S. was down from $267 million U.S. in the same period last year. It also incurred a net loss of $130 million U.S. That was four times the $32-million U.S. loss it incurred in prior-year period.
Generating consistent revenue growth has been a problem for BlackBerry and that's one of the reasons that the stock has struggled in recent years. But there is reason for optimism, especially as the company's fresh off its new release that it will b e working with Amazon Web Services to co-develop BlackBerry IVY, which it says will bring in recurring revenue for the business.
BlackBerry stock is now down almost to where it was before investors learned of the announcement. That could make now a great buying opportunity as the negativity around earnings could give investors a chance to buy the stock at a reduced price. The deal with Amazon is sure to bring in some revenue down the road and that should help get the stock on a much more positive trajectory, one that could lead to some strong, long-term returns for investors who buy it today.
Although BlackBerry investors may be frustrated with the company's latest results, they shouldn't get too down on the stock as there's still lots of potential in the years to come as it develops IVY. Year to date, BlackBerry's stock is up just 2% after the recent drop and a further fall in price could make it too good of a buy to pass up.
