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Earnings Due For BlackBerry Stock Amid Intellectual Property Sale, Volatility In Meme Stocks

A May-quarter earnings report for BlackBerry stock comes late Thursday, with management expected to provide an update on the pending sale of its intellectual property portfolio. The BlackBerry earnings report arrives amid continued volatility for BB stock and other social media-driven meme stocks, such as AMC Entertainment (AMC).

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Analysts expect BlackBerry (BB) first first-quarter revenue to fall 20% to $171.3 million, mainly due to lower intellectual property licensing revenue ahead of the pending sale. BlackBerry earnings are expected swing to a 5-cent loss from 2-cent profit in the year earlier period.

Blackberry stock has gained some 95% in 2021, though shares have retreated a bit from a rally in early June. Investors using social media have sent up BB stock as well as other meme stocks, including movie chain AMC, GameStop (GME) and Clover Health (CLOV).

“We believe the (BlackBerry) rally reflects trading dynamics, as opposed to materially improved fundamentals,” RBC Capital analyst Paul Treiber said in a note to clients. “We anticipate that BlackBerry’s core software business will remain soft.”

BlackBerry Stock: Update On Intellectual Property Sale?

Treiber said Blackberry management could provide an update on the sale of intellectual property assets.

“Due to the pending patent sale, we expect licensing and other revenue to decline 71% to $15 million, in line with BlackBerry’s guidance,” Treiber added.

“The sale of BlackBerry’s patent portfolio will help finance new software investments,” he went on to say. “However, we estimate that BlackBerry’s patents are worth $1 billion in a sale scenario, which we believe is already priced into the shares.”

BB Stock: Pivot To Enterprise Software

BlackBerry stock fell 2.3% to near 13 on the stock market today. Here’s an in-depth look at BB stock, using IBD technical and fundamental analysis, ahead of the BlackBerry earnings report.

A one-time leading maker of mobile devices, BlackBerry was a driving force in pagers and cellphones. But its hardware business collapsed in 2008 amid competition from Apple (AAPL) iPhones and Android devices.

BlackBerry pivoted to mobile security software under Chief Executive John Chen. Also, BlackBerry has been a provider of software in the automotive market for entertainment and mapping programs.

If you’re new to IBD, consider taking a look at its stock trading system and CAN SLIM basics. Recognizing chart patterns for companies like BlackBerry stock is one key to the investment guidelines.

IBD offers a broad range of growth stock lists, such as Leaderboard. Investors also can create watch lists, find companies nearing a buy point, or develop custom screens at IBD MarketSmith.

Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.

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