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BlackBerry Earnings a Key Report Card on John Chen's Turnaround Plan

Beyond the quarterly numbers, the real question is: Has Chen started convincing more businesses to sign up for the latest BlackBerry offerings?

Asa Mathat

BlackBerry’s earnings report on Friday will offer more than just a snapshot of the last three months of sales. It should also offer some context with which to judge CEO John Chen’s contention that BlackBerry’s turnaround effort is ahead of schedule.

BlackBerry turned a surprise profit last quarter and Chen said at this month’s Mobile World Congress that the company should continue to generate positive cash flow, as it did last quarter. An actual profit is another question; the company is predicted to post a quarterly loss of four cents per share on revenue of $795.5 million, according to Yahoo Finance.

“We’re going to be making more money,” he said in Barcelona. “We’re going to be generating more cash.”

But whether BlackBerry reports a narrow profit or a narrow loss, the real question is how well Chen is doing in convincing businesses and governments to sign up for the company’s latest server software, devices or both. Chen also said he expected revenue will stabilize this year, but declined to say how well the latest crop of devices — the Passport and the Classic — were selling, citing the upcoming earnings report.

Chen did say BlackBerry will introduce four handsets this year, showing a glimpse of the Leap, a five-inch, affordable all-touch model, and teasing a curved-screen model with a keyboard that is due later in the year.

But much of the company’s focus has been on rebuilding its software and services business. As part of that, BlackBerry is working to make sure its software and services work with iPhones and Android devices, in addition to BlackBerry’s own hardware. The company also wants to bring some elements of the software on its devices — features such as the BlackBerry Hub — to rival devices.

Chen has said the company wants to get $500 million in software revenue this year.

This article originally appeared on Recode.net.