Canada's BlackBerry today reported first-quarter sales that missed analysts' forecasts due to an unexpected drop in its high-margin software sales.
Revenue from its software and services business, whose success is at the heart of chief executive John Chen's plan for turning around the company, fell 4.7% to $101m in the first quarter from a year ago.
Investors had high expectations going into BlackBerry's report today.
The stock had gained about 60% since its last quarterly results in March on hopes sales were poised to take off under a turnaround effort focused on selling industrial software to businesses.
The company reported revenue on adjusted basis of $244m for the quarter ending May 31, missing analysts' estimates of $264.5m, according to Thomson Reuters I/B/E/S.
Quarterly profit totaled $671m, or $1.23 per share, compared with a loss of $670m, or $1.28 per share, a year earlier.
The quarter included a $940m arbitration payment from US chipmaker Qualcomm.