Date: February 17, 2024. — BlackBerry provided an update on its ongoing efforts to separate its Internet of Things (IoT) and Cybersecurity businesses into independent divisions, while simultaneously charting a path toward profitability and positive cash flow.
The company has already identified and implemented actions that will yield an annual cost reduction of $50 million, primarily within the Cybersecurity division. Additionally, during the current quarter, BlackBerry is targeting further savings of $55 million. On the revenue front, they expect Cybersecurity’s Annual Recurring Revenue (ARR) to stabilize. Overall company revenue is projected to fall within the range of $150-159 million.
Significant progress has been made toward establishing the two independent departments. Leadership teams have been formed, including Chief Financial Officers, Chief People Officers, and General Counsel for IoT and Cybersecurity. Back-office teams are also being formed to complement the existing sales, marketing, and research and development roles. BlackBerry has hired Alvarez & Marsal, a management consulting firm, to help with the separation process.
BlackBerry expects to achieve positive operating cash flow by the fourth quarter of the upcoming fiscal year (FY25). The company also highlighted its recent debt raise of $200M convertible debenture. This reduced its debt by 45% and provided long-term liquidity and stability.
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