BlackBerry (NYSE:BB) reported better-than-expected results in Q1 2015, reiterating the notion that the company is far from finished. The surprise GAAP profit posted by BlackBerry has been positively received by the market, as the stock rallied 14% to $9.48 before declining as a result of profit booking. Following are some of the highlights.

Overall picture in the quarter
Revenue remained flat at $966 million in the quarter. Revenue from 1.6 million smartphones was recognized in the quarter, compared to 1.3 million in the previous quarter. Gross margin on a GAAP basis was 46.7%. Adjusted gross margins improved by 5 percentage points on a quarter-over-quarter basis to 48% due to favorable portfolio and revenue mix. Operating expenses declined 57% year over year, and 13% since the prior quarter.

On a GAAP basis, BlackBerry posted net income of $23 million, EPS of $0.04. On a non-GAAP basis (after excluding non-cash and non-recurring charges and income), there was a loss of $60 million, or $0.11 per share 

Cash and Investments balance increased from $2.7 billion in the prior quarter to $3.1 billion. However, cash burn on an adjusted basis was over $255 million, excluding the impact of tax refunds worth $397 million and cash proceeds from real estate sale of $287 million.

Channel inventory was down by 22% from the prior quarter, which is indicative of better inventory management and improved sales

Product highlights
The demand for the recently launched Z3 in Indonesia has been strong and inventory ran low during certain periods. Volume forecasts have been beyond expectations. Z3 already launched in Vietnam and will be launched in India next week. Additionally, there are two new device launches planned for this year -- BlackBerry Passport in September and BlackBerry Classic in November.

BBM registrations hit 160 million, of which 85 million are active users. The launch of BBM for Windows phones in July is expected to increase the user base for BBM, as the recent launch of BBM Protected has received strong interest among enterprises.

In the Mobile Device Management space, over 1.2 million BES10 licenses have been issued , including 10% traded in from competing MDM Platforms under the EZ Pass program.

The Amazon partnership
BlackBerry has tied up with Amazon for its forked Android Apps. Its appstore will come pre-loaded with OS10.3, which is to be launched soon. This will allow BlackBerry to focus on its strength -- secure enterprise applications -- while depending on Amazon for consumer apps. 

In conclusion
Expect to an increase in revenue from next quarter onward as the company focuses on growth, now that the cost rationalization initiatives are over. The signals are positive, but the turnaround is still an uphill task. The fight is still on.

Saurav Chakraborty has no position in any stocks mentioned. The Motley Fool recommends Amazon.com. The Motley Fool owns shares of Amazon.com. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.