Blackberry (NYSE: BB) stock price has crashed hard after becoming incredibly popular during the infamous meme season in 2021. At the time, the stock soared from $6.60 in January 2021 to $28.72, a 340% surge. Since then, it has become a penny stock trading at $3.10.

Blackberry’s stock has plummeted in the past few years amid ongoing fundamental challenges in its business. 

Data shows that its annual revenue has dropped from over $1.04 billion in 2020 to $843 million in the last financial year. It has also reported substantial losses, with the biggest one coming in 2020 when it had a net loss of over $1.1 billion. Blackberry has lost over $2 billion in the last five years. 

The most recent financial results revealed that the company’s revenue came in at $173 million in Q1, helped by its cybersecurity division, which brought in $92 million. Its IoT revenue came in at $66 million while licensing rose to $15 million.

The management expects the loss-making to continue for a while and is working to fix it through cost cuts. It has slashed costs worth over $50 million and is working to save an additional $55 million, especially in its cybersecurity business.

Therefore, Blackberry is still a fallen angel that is struggling to reinvent itself. At its peak, it was the most trusted smartphone manufacturer in the world. It exited the industry and left the likes of Apple, Samsung, and Huawei in charge. 

The company is now hoping to become a leading player in industries like automotive, cybersecurity, and the Internet of Things. For example, its QNS operating system powers autonomous vehicles, robotics, medical devices, and rail. 

The challenge is that these sectors are not growing as fast as they used to in the past. Also, the company is facing substantial competition from other companies.

BB chart by TradingView

Blackberry and other meme stocks surged by double-digits this week after the return of Roaring Kitty. AMC and GameStop led the charge, as I had predicted before. 

Turning to the daily chart, we see that BB stock price has moved sideways in the past few weeks. It has remained below the crucial level at $5.80, the highest point in August last year. It has also remained below the 50-day moving average.

I suspect that the stock has entered the accumulation phase of the Wyckoff Method, which is characterised by low-volume flows. If this is correct, the stock will likely jump sharply as buyers target the key resistance at $5.80, which is about 87% above the current level. This view will become invalid if the stock drops below the year-to-date low of $2.50. 

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