Core Insights - BlackBerry Limited (NYSE:BB) is recognized as one of the best stocks under $5 to buy, with RBC Capital reaffirming a Sector Perform rating and a price target of $4.50 following the company's Q3 FY26 earnings report [1] Financial Performance - BlackBerry reported Q3 2026 results on December 18, achieving total revenue of $141.8 million, which exceeded prior guidance and represented a 9% sequential increase from Q2, although it showed a 1% year-over-year decline [2] - The QNX IoT division achieved record quarterly revenue of $68.7 million, marking a 10% year-over-year growth, driven by deeper automotive penetration and expansion into adjacent markets [3] - Other revenue segments included Secure Communications at $67 million and Licensing and other revenue totaling $6.1 million [3] Guidance and Future Outlook - Management raised the full-year FY26 revenue guidance midpoint to $531-541 million from the previous $519-541 million, while maintaining adjusted EBITDA at $82-101 million and non-GAAP EPS at $0.11-0.15 [4] - The sustained momentum in QNX and Secure Communications is identified as key growth drivers for the company [4] Company Overview - BlackBerry Limited is a cybersecurity and software company that provides intelligent security software and services to enterprises and governments, with a portfolio that includes cybersecurity solutions, unified endpoint management, and QNX software for mission-critical applications [5]

Group 1 - The article introduces KTW Advisory as a new contributing analyst for Seeking Alpha, inviting individual investors to share their investment ideas for publication and potential earnings [1] - The individual investor mentioned has 20 years of experience in life science, technology, and momentum stocks, with a strong educational background in finance and management [2] - The investor's writing focuses on interpreting financial statements in the context of management strategy and execution, emphasizing valuation discipline and downside risk assessment [2] Group 2 - The investor aims to provide transparent analysis that helps others understand both the opportunities and risks associated with investments, highlighting the importance of balance sheet strength and competitive positioning [2] - The article includes a disclosure stating that the author has a beneficial long position in the shares of a specific company, BB, indicating personal investment interest [3] - Seeking Alpha clarifies that past performance does not guarantee future results and that the views expressed may not reflect the platform's overall stance [4]

Core Insights - The article introduces KTW Advisory as a new contributing analyst to Seeking Alpha, inviting individual investors to share their investment ideas for publication and potential earnings [1] Group 1 - The individual investor has 20 years of experience in life science, technology, and momentum stocks, with advanced degrees in computer information systems, MBA, and Masters in Finance [2] - The writing focuses on interpreting financial statements in the context of management strategy, incentives, and execution to develop clear, risk-adjusted investment theses [2] - The approach emphasizes valuation discipline, downside risk assessment, and identifying gaps between market perception and underlying fundamentals, particularly focusing on balance sheet strength and competitive positioning [2]

Core Viewpoint - BlackBerry Limited will host an investor-focused presentation and Q&A session at CES 2026, highlighting key announcements and growth drivers for QNX [1] Group 1 - The presentation will be streamed from the QNX booth at CES 2026 in Las Vegas [1] - Members of the management team will participate in the session [1] - The focus will be on how CES announcements are contributing to growth for QNX [1]

Core Insights - The information technology sector has several oversold stocks, presenting potential buying opportunities for undervalued companies [1] Group 1: Oversold Stocks - Arm Holdings PLC has an RSI of 27.3, with a recent stock price of $114.03, and has seen a 15% decline over the past month [7] - Crane NXT Co has an RSI of 26.7, closing at $47.20, and has experienced a 14% drop in the last month [7] - BlackBerry Ltd has an RSI of 24, with shares closing at $3.77 after a 13% decrease over the past five days [7] Group 2: Analyst Ratings and Performance - Goldman Sachs downgraded Arm Holdings from Neutral to Sell, lowering the price target from $160 to $120 [7] - Baird maintained an Outperform rating for Crane NXT, reducing the price target from $88 to $82 [7] - BlackBerry reported Q3 revenue of $141.8 million, exceeding estimates, and achieved its strongest GAAP profitability in nearly four years [7]

Core Insights - The information technology sector has several oversold stocks, presenting potential buying opportunities for undervalued companies [1] Group 1: Oversold Stocks - Arm Holdings PLC has an RSI of 27.3, with a recent stock price of $114.03, and has seen a 15% decline over the past month [7] - Crane NXT Co has an RSI of 26.7, with a recent stock price of $47.20, and has experienced a 14% drop in the last month [7] - BlackBerry Ltd has an RSI of 24, with a recent stock price of $3.77, and reported a 13% decline over the past five days [7]

Core Viewpoint - BlackBerry's shares declined 13.7% despite a solid earnings report, indicating that investor expectations were not met [1][9]. Financial Performance - In Q3 of fiscal year 2026, BlackBerry reported revenue of $141.8 million, a decrease of 1.8% year-over-year, while adjusted earnings were $0.05 per diluted share, an improvement from breakeven in the previous year [2]. - Analyst consensus anticipated earnings of approximately $0.04 per share with sales around $135.6 million, indicating that BlackBerry's performance slightly exceeded expectations [2]. Guidance and Market Reaction - BlackBerry's management updated their full-year guidance, raising the lower end of the target ranges while keeping the upper end mostly unchanged, reflecting a mildly bullish outlook for Q4 [3][4]. - The market reacted negatively, focusing on the year-over-year revenue decline and signs of slower momentum in key operating metrics, particularly recurring revenues, rather than the positive earnings beat [7]. Investor Sentiment - The sell-off appears to be a case of investors "selling the news," as they were looking for more significant upside in guidance rather than just a higher floor [6][9]. - The valuation of BlackBerry was high at 48 times trailing earnings, leaving little room for anything less than a strongly positive outlook [4].

Core Insights - The article emphasizes the importance of identifying deeply discounted stocks and provides resources for individual investors to enhance their investment strategies [1][2]. Group 1: Investment Strategies - The investing group DIY Value Investing offers insights into undervalued stocks with potential catalysts for price appreciation [2]. - Recommendations include dividend-growth income stocks, which have a history of consistent dividend increases [2]. - The platform provides tools such as a printable dividend calendar and quantitative scores to assist investors in making informed decisions [2]. Group 2: Analyst Background - Chris Lau, the author, has 30 years of experience in the investment field, focusing on life sciences, technology, and dividend-growth stocks [2]. - Lau holds degrees in Microbiology and Economics, enhancing his analytical capabilities in evaluating investment opportunities [2].

Core Insights - The article emphasizes the importance of identifying deeply discounted stocks and provides resources for individual investors to enhance their investment strategies [1][2]. Group 1: Investment Strategies - The investing group DIY Value Investing offers insights into undervalued stocks with potential catalysts for price appreciation [2]. - Recommendations include dividend-growth income stocks, which have a history of consistent dividend increases [2]. - The platform provides tools such as a printable dividend calendar and quantitative scores to assist investors in making informed decisions [2]. Group 2: Analyst Background - The analyst, Chris Lau, has 30 years of experience in life science, technology, and dividend-growth income stocks, holding degrees in Microbiology and Economics [2]. - The article does not disclose any current stock positions or plans to initiate positions in the mentioned companies within the next 72 hours [3].

Financial Performance - For the three months ended November 30, 2025, BlackBerry reported revenue of $141.8 million, a slight decrease of 1.3% compared to $143.6 million for the same period in 2024[25]. - Operating income for the three months ended November 30, 2025, was $11.9 million, down from $19.5 million in the same period last year[25]. - Net income for the three months ended November 30, 2025, was $13.7 million, compared to a net loss of $10.5 million for the same period in 2024[25]. - For the nine months ended November 30, 2025, net income was $28.9 million, a substantial improvement from a net loss of $71.6 million in the prior year[30]. - Comprehensive income for the three months ended November 30, 2025, was $12.6 million, compared to a comprehensive loss of $15.0 million for the same period in 2024[28]. - The Company reported a net income of $13.7 million for the three months ended November 30, 2025, compared to a loss of $10.5 million in the same period of the previous year[103]. - For the three months ended November 30, 2025, total segment revenue was $141.8 million, a decrease of 1.3% compared to $143.6 million for the same period in 2024[125]. - For the nine months ended November 30, 2025, total segment revenue was $393.1 million, consistent with $393.2 million for the same period in 2024[131]. Cash and Liquidity - Cash and cash equivalents as of November 30, 2025, totaled $270.3 million, up from $266.7 million as of February 28, 2025[17]. - The company’s cash, cash equivalents, and restricted cash at the end of the period totaled $284.3 million, up from $200.2 million a year earlier[30]. - The company reported a net cash increase of $4.0 million in cash, cash equivalents, and restricted cash during the period, compared to a decrease of $0.3 million in the prior year[30]. - Cash, cash equivalents, and investments amounted to $377.5 million as of November 30, 2025, including common shares of Arctic Wolf valued at $24.6 million[148]. - As of November 30, 2025, the Company had $377.5 million in cash, cash equivalents, and investments, down from $410.3 million as of February 28, 2025[184]. Expenses and Costs - Research and development expenses for the three months ended November 30, 2025, were $29.6 million, an increase of 6.1% from $27.9 million in the prior year[25]. - Operating expenses increased to $98.0 million in the third quarter of fiscal 2026, up 5.3% from $92.7 million in the same quarter of fiscal 2025[178]. - The Company incurred restructuring charges of $6.1 million in Q3 fiscal 2026, compared to $6.5 million in Q3 fiscal 2025[191]. - The company's operating expenses decreased to $271.4 million for the nine months ended November 30, 2025, down from $282.0 million in the same period of 2024, indicating cost management efforts[196]. Shareholder Equity and Stock - The company’s total shareholders' equity increased to $741.1 million as of November 30, 2025, compared to $719.9 million as of February 28, 2025[17]. - Basic earnings per share from continuing operations for the three months ended November 30, 2025, was $0.02, consistent with the same period in 2024[25]. - BlackBerry's total basic earnings per share for the three months ended November 30, 2025, was $0.02, compared to a loss of $0.02 in the same period last year[25]. - The Company repurchased 8.6 million common shares at a cost of $34.0 million during the nine months ended November 30, 2025, reducing capital stock by $42.8 million[100]. - Common shares outstanding as of November 30, 2025, totaled 590.4 million, down from 596.2 million as of February 28, 2025[99]. Segment Performance - QNX segment revenue for the three months ended November 30, 2025, was $68.7 million, up 10.3% from $62.3 million in 2024[125]. - Secure Communications segment revenue for the three months ended November 30, 2025, was $67.0 million, down 10.1% from $74.6 million in 2024[125]. - Licensing segment revenue for the three months ended November 30, 2025, was $6.1 million, a decrease of 8.9% compared to $6.7 million in 2024[125]. - The total segment adjusted gross margin for the three months ended November 30, 2025, was $110.4 million, down from $112.9 million in 2024[130]. - The Secure Communications Annual Recurring Revenue (ARR) reached approximately $216 million as of November 30, 2025, showing a growth from $215 million in the same period last year[208]. Impairments and Adjustments - The company recorded a pre-tax impairment charge of $0.6 million and $1.2 million for the three and nine months ended November 30, 2025, respectively, related to operating lease right-of-use assets and property, plant, and equipment[59]. - The company recorded no realized gains or losses on available-for-sale debt securities for the three and nine months ended November 30, 2025[66]. - The company has restricted cash and cash equivalents pledged as collateral for letters of credit and a performance bond, which are legally restricted from access during the lease terms[67]. - The company recorded an accumulated other comprehensive loss of $13.1 million as of November 30, 2025[106]. Taxation - The net effective income tax expense rate for the nine months ended November 30, 2025, was approximately 13%, a decrease from 28% for the same period in 2024[91]. - The Company's total unrecognized income tax benefits as of November 30, 2025, were $19.7 million, slightly up from $19.5 million as of February 28, 2025[92]. Future Outlook and Strategy - The QNX division aims to increase adoption of its QNX SDP 8.0 and capture a larger share of the automotive software stack in fiscal 2026[164]. - BlackBerry Radar provides asset monitoring and telematics solutions for the transportation and logistics industry, enhancing fleet management analytics[166]. - The Secure Communications division focuses on government and regulated enterprise markets, providing highly secure communication solutions[160]. - The Company expects to meet its funding requirements for current financial commitments and future operating expenditures based on its financial projections[149].