Key Takeaways BlackBerry adds Windows support to SecuSUITE, enhancing secure voice, messaging and file sharing.The update extends sovereign-grade protection to laptops and workstations for seamless, secure workflows.Available in November 2025, the expansion offers flexible deployment and full-data sovereignty control.BlackBerry Limited (BB) announced the expansion of BlackBerry SecuSUITE to include Windows laptops and workstations, extending its sovereign-grade secure communications platform trusted by gove ...

Group 1: Company Overview - BlackBerry Limited (NYSE:BB) is a Canadian cybersecurity and embedded software company, recognized for its QNX operating system used in advanced driver assistance systems and secure solutions for government and enterprise clients [1][2] Group 2: Financial Performance - As of September 2025, BlackBerry is preparing to release its Q2 fiscal 2026 results, with analysts expecting an EPS of $0.01 and revenues around $122 million, reflecting a 13.8% year-over-year decline due to macroeconomic pressures and challenges in the automotive sector [2] Group 3: Growth Drivers - Key growth drivers for BlackBerry include the expanding adoption of the QNX platform and the launch of QNX Hypervisor 8.0, which allows multiple guest operating systems to run alongside safety-critical workloads, essential for autonomous vehicle production [2] - The Secure Communications segment is gaining momentum through products like Secusmart and AtHoc, with AtHoc achieving FedRAMP High authorization for U.S. federal clients, supported by a strong deal pipeline and major government contracts [4] Group 4: Competitive Positioning - BlackBerry has achieved a significant milestone as the first mobile device management vendor certified by Germany's BSI for its BlackBerry Unified Endpoint Management (UEM) with Apple Indigo and Samsung Knox devices, enhancing its competitive edge in government and critical infrastructure markets [3][4] - The company has raised its full-year revenue guidance, further solidifying its position as a notable player in the cybersecurity and secure communications space [4]

Financial Data and Key Metrics Changes - Company revenue for Q2 was $129.6 million, growing 3% year-over-year, with adjusted EBITDA reaching 20% of revenue [5][17] - GAAP net income was positive at $13.3 million, marking a significant turnaround from a $19.7 million loss in the prior year [17][20] - Non-GAAP EPS was positive at $0.04, beating guidance [5][17] - Operating cash flow was $3.4 million, with free cash flow at $2.6 million [20] Business Line Data and Key Metrics Changes - QNX revenue was $63.1 million, representing a 15% year-over-year growth, with an adjusted EBITDA margin of 32% [6][18] - Secure Communications revenue was $59.9 million, with annual recurring revenue (ARR) growing by $4 million to $213 million [11][18] - Licensing division revenue was $6.6 million, with adjusted EBITDA at $5.6 million [19] Market Data and Key Metrics Changes - QNX design wins were ahead of plan in Q2, with a solid pipeline for the second half of the fiscal year [6][10] - The Secure Communications division saw reduced customer churn and secured significant contracts with government entities [14][15] Company Strategy and Development Direction - The company is focusing on growth in the QNX business, particularly in automotive and safety-critical software [10][22] - Strategic partnerships with companies like Qualcomm and NVIDIA are being leveraged to enhance product offerings [9][33] - The introduction of a new recurring revenue model through hosted services is expected to create a more predictable revenue profile for the Secusmart business [12][15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the second half of the fiscal year, citing improved visibility and reduced uncertainty in the automotive market [22][40] - The company is raising full-year revenue and adjusted EBITDA guidance due to stronger-than-expected performance in the first half [21][23] Other Important Information - The company repurchased approximately $20 million worth of shares during the quarter, totaling 5 million shares [20] - The QNX division is expanding its developer community through educational initiatives, with over 4,000 students participating in QNX learning sessions [10] Q&A Session Summary Question: Operating leverage in QNX - Management indicated strong operating leverage in QNX, with expectations for improved gross margins as royalty mix increases [28][29] Question: Approach to the China market - Management highlighted a shift in the Chinese market towards safety-critical software, which aligns with the company's strengths [31][32] Question: Drivers of QNX growth in the back half of the year - Management noted that the revenue trend for QNX has historically been back-end loaded, driven by the start of programs and design work [36][37] Question: Backlog growth in QNX - Management stated that Q2 showed a recovery in backlog growth after a weaker Q1, with a solid pipeline for the second half [45][46] Question: Sustainability of QNX growth - Management expressed confidence in maintaining double-digit growth for QNX, supported by new programs and a strong pipeline [47][48]

Core Insights - BlackBerry Limited is set to release its earnings on September 25, 2025, with an expected EPS of $0.01 and projected revenue of $122 million [1][6] - The anticipated revenue for Q2 fiscal 2026 is between $115 million and $125 million, reflecting a 13.8% decline year-over-year due to challenges in the macroeconomic and automotive sectors [2][6] Financial Performance - BlackBerry has a history of impressive earnings surprises, averaging a 116.67% beat over the last four quarters, although the current model does not predict a beat for this quarter [4] - The Zacks Consensus Estimate for BlackBerry's earnings remains at 1 cent, unchanged over the past 60 days [4] - Financial metrics indicate challenges, with a negative P/E ratio of approximately -74.75 and a price-to-sales ratio of about 4.73 [5][6] - Despite these challenges, BlackBerry maintains a healthy current ratio of about 2.15, indicating sufficient current assets to cover liabilities [5][6] Business Segments - The performance of BlackBerry's Q2 results is expected to depend on the momentum of its QNX platform, expansion in the GEM market, and securing government deals [3] - Demand for QNX in the automotive and GEM markets, along with the introduction of Hypervisor 8.0, is anticipated to bolster division revenues [3] - The Secure Communications segment is gaining traction through Secusmart and AtHoc solutions, supported by significant government contracts [3]

Key Takeaways BlackBerry expects Q2 revenues of $115-$125M.QNX demand in auto and GEM markets, plus new Hypervisor 8.0, are expected to drive division revenues.Secure Communications gains traction with Secusmart and AtHoc, supported by key government contracts.BlackBerry Limited (BB) is set to report second-quarter fiscal 2026 results on Sept. 25.The Zacks Consensus Estimate for the bottom line is pinned at 1 cent and has remained unchanged in the past 60 days.BB expects second-quarter fiscal 2026 revenues ...

Core Insights - BlackBerry Limited reported first-quarter fiscal 2026 non-GAAP earnings per share (EPS) of 2 cents, surpassing its own estimate of a loss of 1 cent to breakeven and the Zacks Consensus Estimate pegged at breakeven [1][10] - Total revenues for the quarter reached $121.7 million, exceeding guidance of $107-$115 million but reflecting a 1.4% year-over-year decline, primarily due to weaker sales in Secure Communications and Licensing units [2][10] Financial Performance - The QNX business generated revenues of $57.5 million, exceeding the high end of guidance ($51-$55 million) and showing an 8% year-over-year growth, driven by a 9% increase in royalties and a 23% rise in development seat license revenues [7] - Secure Communication revenues declined 7.3% year over year to $59.5 million but exceeded the top limit of guidance ($50-$54 million) due to strong sales in the German government sector [8] - Adjusted gross margin improved to 74.6%, up from 73.5% in the previous year, while QNX's gross margin fell to 81% due to adverse forex impacts [12] Guidance and Outlook - BlackBerry raised its full-year revenue guidance to $508–$538 million and adjusted EBITDA to $72–$87 million, reflecting a stronger outlook for Secure Communications revenues and EBITDA [5] - For fiscal second-quarter 2026, the company expects revenues in the range of $115-$125 million and non-GAAP EPS between breakeven and 1 cent [15] - The company continues to project Licensing & Other revenues to be around $24 million, with non-GAAP loss per share expected to be between 8 cents and 10 cents [4] Market Reaction - Following the better-than-anticipated performance, BlackBerry's shares gained 10% in pre-market trading on June 25, 2025, and have increased by 95.9% over the past year compared to the Zacks Internet-Software industry's growth of 37.6% [6]

Core Viewpoint - BlackBerry Limited's shares have increased by 21.3% in the past month, outperforming the Computer Software industry and the S&P 500 composite, which grew by 18.7% and 8% respectively [1] Price Performance - BlackBerry's stock closed at $3.92, which is down 37.2% from its 52-week high of $6.24 [4] QNX Business Development - BlackBerry has shifted focus to its QNX platform, having sold its Cylance unit for $80 million in cash and 5.5 million shares, while retaining its AI/ML patent assets and tax losses [5] - The QNX business is experiencing growth, particularly in the automotive sector, with strong demand in advanced driver assistance systems (ADAS) and digital cockpit solutions [6] - QNX revenues reached $65.8 million, exceeding guidance of $60-$65 million, driven by design wins in digital cockpit and ADAS [7] Revenue Guidance and Market Conditions - BlackBerry maintains a revenue guidance of $260-$270 million, with QNX revenues expected between $250 million and $270 million, amid uncertainties from recent tariff changes [9] Secure Communication Division - The Secure Communication division reported fiscal fourth-quarter revenues of $67.3 million, surpassing the forecast of $62-$66 million, driven by strong performance in the AtHoc platform [10] - The division is seeing healthy momentum from government agencies and top banks, with a notable expansion of a deal with the Malaysian government [11] Financial Performance - BlackBerry's adjusted EBITDA for fiscal 2025 was $39.3 million, reflecting a $54 million improvement from the previous year, aided by cost-cutting measures [13] - Cash and investments increased by $144 million, supported by strong operating cash flow of $42 million and the initial payment from the Cylance deal [14] Analyst Sentiment and Valuation - Analysts have revised EPS estimates for the current fiscal year upward to 10 cents from 7 cents over the past 60 days, indicating bullish sentiment [17] - BB stock is trading at a trailing 12-month price/book multiple of 3.25, compared to the industry average of 5.87, suggesting it is undervalued [18] Investment Opportunity - The pivot towards the QNX business, improving financials, and strong estimate revisions present a compelling buying opportunity for BlackBerry stock [19]

Financial Data and Key Metrics Changes - Total company revenue for Q4 was $141.7 million, exceeding guidance [11] - Adjusted EBITDA for Q4 was $21.1 million, beating guidance [12] - Adjusted EPS for Q4 was positive $0.03, surpassing expectations [42] - Total cash and investments increased by $144 million, driven by strong operating cash flow of $42 million [13][45] Business Line Data and Key Metrics Changes - QNX division revenue for Q4 was $65.8 million, beating guidance [11] - Secure Communications division revenue for Q4 was $67.3 million, also exceeding guidance [29] - Licensing revenue for Q4 was $8.6 million, above expectations [35] - Adjusted EBITDA for Secure Communications was $12.6 million for Q4, significantly beating guidance [38] Market Data and Key Metrics Changes - QNX's royalty backlog grew to approximately $865 million, indicating future revenue potential [20] - Annual recurring revenue (ARR) for Secure Communications decreased by $7 million sequentially but increased by $6 million year-over-year to $208 million [34] Company Strategy and Development Direction - The company is focusing on its core growth driver, QNX, and has reduced its cost run rate by over $150 million [60] - The company is expanding its market presence beyond automotive into adjacent verticals such as medical and industrial [82] - The QNX division will now be referred to as QNX to reflect its key role [25] Management's Comments on Operating Environment and Future Outlook - Management noted uncertainty in the automotive sector due to recent tariff changes but emphasized resilience due to diversified revenue sources [48] - The company expects revenue for the full fiscal year 2026 to be in the range of $250 million to $270 million, indicating a 10% growth at the midpoint [49] - Management expressed confidence in maintaining strong relationships with government clients, which are expected to mitigate risks from potential changes in administration [106] Other Important Information - The company completed the sale of the Cylance business to Arctic Wolf, receiving approximately $80 million in cash and common shares [14][43] - The company retained its AI/ML endpoint security patents and tax losses, which are expected to benefit future profits [15] Q&A Session Summary Question: Impact of tariffs on auto OEMs - Management has not seen significant supply chain issues from OEMs related to tariffs, indicating a degree of insulation due to diversified revenue sources [64][65] Question: US federal business impact on Secure Communications - US federal contracts represent about 20-25% of Secure Communications, with no material impact observed so far [68][70] Question: Timeline for OEMs adjusting to tariff impacts - OEMs are still navigating the situation, with no significant downtick in supply chain volumes reported [74][75] Question: Business outside the US - The company is optimistic about growth opportunities outside the US, particularly in Europe, and is investing in adjacent markets [80][82] Question: Vehicle OS initiative and content opportunities - There is a consistent trend of OEMs seeking to expand their collaboration with the company, indicating potential for increased content per vehicle [96][100] Question: Risks related to government contracts - Long-term agreements with governments are expected to remain stable, with opportunities for consolidation and expansion of services [106]