BlackBerry Ltd (BBRY) May Reach ‘cash flow break-even’ Next Quarter

BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB)’s CEO John Chen has been entrusted with the responsibility of turning the company’s fortunes and he has been working on it quite diligently. The quarterly results will be out soon, and it is expected that by next quarter the company would reach the ‘cash flow break-even,’ which would be a pleasant surprise for the investors. This would be sooner than promised by the CEO John Chen, who said that this would happen by fiscal 2016.

‘Passport’ success vital

Though BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) is planning to shift its focus to software, but at present they are paying equal attention to the hardware. The company will be releasing new smartphone devices back to back, and the next big launch is the ‘Passport,’ which scheduled for release on the 24th of September. The break-even position of the company will be reached sooner if this launch is a successful one believes Raymond James analyst Steven Li.

“We estimate BBRY could approach cash flow break-even as early as its November quarter with a successful Passport launch,” he said.

The Passport device is scheduled for release in Dubai, Hong Kong and London. The high demand for luxury brands in these nations could make the Passport sales go higher than expected, and if this happens it would create a trading opportunity for investors, says Li.

September 26, important day for BlackBerry

The shares are currently trading around $12, and have the potential of moving upwards. However, this rise in shares will be temporary, noted analyst. BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB)’s services side is on a steady decline and this has put immense pressure on the company. Hence, there is a need of making up for the revenues by performing well in other areas.

The major issue faced by BlackBerry Ltd (NASDAQ:BBRY) (TSE:BB) is that its smartphone shipments are on a decline from past few years, and the company is struggling to re-gain its share in the smartphone market that it enjoyed at one point in time. Analysts expect the smartphone shipments to decline on a year-over-year basis.

September 26 is going to be an important day for BlackBerry, and for the investors, as the results for the second-quarter of fiscal 2015 will be released on the day. The stock has gained a rating of “Market Perform” from Mr. Li, and a 12-month price target of $10 a share.