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BlackBerry (TSE:BB)
TSX:BB
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BlackBerry
(TSX:BB)
Rating:59Neutral
Price Target:
C$5.50
▲( 6.18% Upside)
Positive Factors
Earnings
BlackBerry reported Q3/F25 results slightly ahead of expectations, driven by solid performances in both Cybersecurity and IoT.
Investment Opportunities
The outlook for the business has improved with strategic initiatives being streamlined and positive adj. EBITDA creating new investment opportunities.
Negative Factors
Growth Visibility
There still isn't great visibility into when the QNX backlog will create an inflection in IoT growth, and macro headwinds persist across both segments of the business.
Market Challenges
The transaction doesn't immediately alleviate some of the macro headwinds the company is facing across both segments of its business.
BlackBerry (BB) vs. iShares MSCI Canada ETF (EWC)
Market Cap
$3.09B
Dividend YieldN/A
Average Volume (3M)1.72M
Price to Earnings (P/E)―
Beta (1Y)1.69
Revenue Growth-31.15%
EPS Growth30.02%
CountryCA
Employees1,820
SectorTechnology
Sector Strength76
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)0.04
Shares Outstanding597,088,260
10 Day Avg. Volume1,758,409
30 Day Avg. Volume1,715,667
Financial Highlights & Ratios
PEG Ratio-1.39
Price to Book (P/B)3.20
Price to Sales (P/S)0.00
P/FCF Ratio-43.92
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$6.47Price Target Upside24.88% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering3
BlackBerry Business Overview & Revenue Model
Company DescriptionBlackBerry Limited provides intelligent security software and services to enterprises and governments worldwide. The company operates through three segments: Cybersecurity, IoT, and Licensing and Other. The company offers BlackBerry Cyber Suite, which provides Cylance AI and machine learning-based cybersecurity solutions, including BlackBerry Protect, an EPP and available MTD solution; BlackBerry Optics, an EDR solution that provides visibility into and prevention of malicious activity; BlackBerry Guard, a managed detection and response solution; BlackBerry Gateway, an AI-empowered ZTNA solution; and BlackBerry Persona, a UEBA solution that provides authentication by validating user identity in real time. It also provides BlackBerry Spark Unified Endpoint Management Suite, such as BlackBerry UEM, a central software component of its secure communications platform; BlackBerry Dynamics that provides a development platform and secure container for mobile applications; BlackBerry AtHoc and BlackBerry Alert secure and networked critical event management solutions; and SecuSUITE for Government, a multi-OS voice and text messaging solution, as well as BBM Enterprise, an enterprise-grade secure instant messaging solution. In addition, the company offers BlackBerry QNX, which provides Neutrino operating system and BlackBerry QNX CAR platform, and other products; BlackBerry QNX, an embedded system solution; BlackBerry Jarvis, a cloud-based binary static application security testing platform; BlackBerry Certicom cryptography and management products, and BlackBerry Radar asset monitoring solution; and BlackBerry IVY, an intelligent vehicle data platform, as well as enterprise and cybersecurity consulting services. Further, it is involved in the patent licensing and legacy service access fees business. As of February 28, 2022, it owned approximately 38,000 worldwide patents and applications. BlackBerry Limited was incorporated in 1984 and is headquartered in Waterloo, Canada.
How the Company Makes MoneyBlackBerry makes money primarily through its software and services segment, which includes cybersecurity solutions, endpoint management, and licensing agreements. The company's revenue streams are driven by enterprise clients seeking secure communication and data management solutions. BlackBerry also generates income from its QNX software, used in automotive infotainment and advanced driver assistance systems (ADAS), as well as from licensing its extensive patent portfolio. Significant partnerships, such as those with automotive manufacturers and technology firms, further bolster its earnings by integrating BlackBerry's secure solutions into various products and services.
BlackBerry Financial Statement Overview
Summary
BlackBerry is facing significant financial challenges with declining revenue, negative profitability, and cash flow issues. Despite maintaining a reasonable cash position, the weakening balance sheet and poor cash flow positions emphasize the need for strategic improvements.Income Statement
BlackBerry's income statement indicates declining revenue with a significant drop in revenue from the previous annual report. The TTM data shows a further decrease. The company has struggled with profitability, displaying negative EBIT and Net Income margins. Despite a slight improvement in EBITDA, overall profitability remains weak, reflecting ongoing financial challenges.45
Neutral
Balance Sheet
The balance sheet shows a moderate debt-to-equity ratio, indicating manageable leverage levels. However, the declining stockholders' equity and total assets point to a reduction in the company's financial stability over time. The equity ratio has decreased, suggesting a weakening balance sheet. Despite this, BlackBerry maintains a reasonable cash position relative to its liabilities.55
Neutral
Cash Flow
Cash flow analysis reveals negative operating and free cash flows, highlighting liquidity challenges. The operating cash flow to net income ratio is poor, indicating inefficiencies in converting earnings into cash. The lack of free cash flow growth reflects cash constraints, further emphasizing the need for operational improvements to enhance liquidity.40
Negative
| Breakdown | |||||
| TTM | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 | Mar 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 605.00M | 853.00M | 656.00M | 718.00M | 893.00M | 1.04B | Gross Profit |
| 431.00M | 520.00M | 419.00M | 467.00M | 643.00M | 763.00M | EBIT |
| -97.00M | -125.00M | -725.00M | -2.00M | -1.11B | -149.00M | EBITDA |
| 2.00M | -13.00M | -112.00M | -38.00M | 102.00M | 29.00M | Net Income Common Stockholders |
| -128.00M | -130.00M | -734.00M | 12.00M | -1.10B | -152.00M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 1.91B | 237.00M | 426.00M | 712.00M | 739.00M | 909.00M | Total Assets |
| 10.20B | 1.40B | 1.68B | 2.57B | 2.82B | 3.89B | Total Debt |
| 0.00 | 252.00M | 419.00M | 573.00M | 810.00M | 726.00M | Net Debt |
| -1.55B | 77.00M | 124.00M | 195.00M | 596.00M | 349.00M | Total Liabilities |
| 2.60B | 619.00M | 822.00M | 1.01B | 1.31B | 1.36B | Stockholders Equity |
| 7.60B | 776.00M | 857.00M | 1.56B | 1.50B | 2.53B |
| Cash Flow | Free Cash Flow | ||||
| -53.00M | -24.00M | -304.00M | -67.00M | 38.00M | -18.00M | Operating Cash Flow |
| -40.00M | -3.00M | -263.00M | -28.00M | 82.00M | 26.00M | Investing Cash Flow |
| -44.00M | 46.00M | 176.00M | 207.00M | -65.00M | -188.00M | Financing Cash Flow |
| 49.00M | -165.00M | 6.00M | 10.00M | -227.00M | 7.00M |
BlackBerry Technical Analysis
Negative
5.18
Price Trends
5.16
Positive
5.87
Negative
4.69
Positive
Market Momentum
0.10
Negative
50.54
Neutral
20.28
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:BB, the sentiment is Negative. The current price of 5.18 is above the 20-day moving average (MA) of 5.11, above the 50-day MA of 5.16, and above the 200-day MA of 4.69, indicating a bullish trend. The MACD of 0.10 indicates Negative momentum. The RSI at 50.54 is Neutral, neither overbought nor oversold. The STOCH value of 20.28 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:BB.
BlackBerry Risk Analysis
BlackBerry disclosed 29 risk factors in its most recent earnings report. BlackBerry reported the most risks in the “Tech & Innovation” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
BlackBerry Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
64 Neutral | C$263.38M | ― | -2.67% | ― | -1.72% | 76.81% | |
61 Neutral | $11.29B | 10.07 | -7.05% | 2.96% | 7.47% | -10.75% | |
61 Neutral | C$662.69M | ― | -9.00% | ― | 8.86% | 56.67% | |
59 Neutral | $3.09B | ― | -7.59% | ― | -31.15% | 30.02% | |
49 Neutral | C$684.10M | ― | -39.72% | 0.74% | 2.47% | 19.37% | |
43 Neutral | C$20.02M | ― | -1525.80% | ― | -7.43% | 30.13% | |
| $732.02M | 30.46 | -5.70% | ― | ― | ― |
* Technology Sector Average
Performance Comparison
TSE:BB
BlackBerry
5.18
1.15
28.54%
TSE:STC
Sangoma Technologies
7.84
0.72
10.11%
TSE:DND
Dye & Durham
10.18
-2.15
-17.44%
TSE:PLUR
Plurilock Security Inc
0.26
-0.06
-18.75%
TIXT
TELUS International (CDA)
2.66
-3.09
-53.74%
TSE:CVO
Coveo Solutions
6.89
-1.02
-12.90%
BlackBerry Earnings Call Summary
Earnings Call Date:Apr 02, 2025
(Q4-2025)
| % Change Since: -3.18%|
Next Earnings Date:Jun 24, 2025
Earnings Call Sentiment Positive
The earnings call presented a positive outlook for BlackBerry, with strong financial performance, successful strategic maneuvers like the Cylance transaction, and significant cost reductions. However, challenges in the automotive sector due to tariffs and a slight decline in Secure Communications revenue and retention rates were noted. Overall, the highlights significantly outweighed the lowlights.Q4-2025 Updates
Positive Updates
Revenue and Profitability Beat Expectations
Total company revenue beat the top-end of guidance at $141.7 million, with QNX division revenue at $65.8 million, Secure Communications at $67.3 million, and Licensing at $8.6 million. Adjusted EBITDA was $21.1 million, with EPS beating expectations at $0.03 and $0.02 for Q4 and the full fiscal year, respectively.
Strong Cash Position
Total cash and investments increased by $144 million, driven by a significant increase in operating cash flow to $42 million and the collection of the initial tranche of cash from the Cylance deal of approximately $80 million.
QNX's Growth and Strategic Wins
QNX's royalty backlog grew to approximately $865 million, demonstrating the addition of future expected royalty revenue. The division secured design wins with leading OEMs and Tier 1 suppliers, particularly in automotive, ADAS, and cockpit domain controllers.
Successful Cylance Transaction
Closed the Cylance transaction with Arctic Wolf, receiving approximately $80 million in cash and 5.5 million common shares, retaining AI/ML endpoint security patents, and expecting a significant tax shield for future profits.
Cost Reduction Achievements
Exceeded the target of removing approximately $150 million of costs from the run rate, significantly transforming profitability with total company adjusted EBITDA at $39.3 million for the year.
Negative Updates
Challenges in Automotive Sector
Uncertainty due to recent automotive tariffs and potential indirect effects on BlackBerry's business due to impacts on customers, including supply chains and macroeconomic demand.
Secure Communications Revenue Decline
Year-over-year revenue for Secure Communications was slightly lower due to a tough compare with the previous year, partially caused by the upfront revenue portion of a large deal with the Malaysian government.
Secure Communications ARR and DBNRR Decline
Annual recurring revenue for Secure Communications decreased by $7 million or 3% sequentially to $208 million, with the dollar-based net retention rate decreasing 2 percentage points sequentially to 93%.
Company Guidance
During the BlackBerry Fourth Quarter and Fiscal Year 2025 Results Conference Call, the company provided detailed guidance and insights into its financial performance metrics. Total company revenue exceeded expectations, reaching $141.7 million, with the QNX division contributing $65.8 million, Secure Communications $67.3 million, and Licensing $8.6 million. BlackBerry reported adjusted EBITDA of $21.1 million and exceeded EPS guidance with $0.03 for Q4 and $0.02 for the full fiscal year 2025. Cash and investments increased by $144 million, driven by $42 million in operating cash flow and $80 million from the sale of Cylance. Looking ahead to fiscal year 2026, BlackBerry expects QNX revenue to range between $250 million and $270 million, Secure Communications between $230 million and $240 million, and Licensing division revenue to be approximately $6 million per quarter. The company anticipates positive operating cash flow around $35 million for the full fiscal year.BlackBerry Corporate Events
M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
BlackBerry Exceeds Fiscal 2025 Expectations, Strengthens Financial Position
Positive
Apr 2, 2025
BlackBerry reported strong financial results for the fourth quarter and full fiscal year 2025, surpassing revenue and profitability expectations across its three divisions: QNX, Secure Communications, and Licensing. The company completed the sale of its Cylance business to Arctic Wolf, enhancing its balance sheet and positioning it for future growth. With increased operating cash flow and a solid financial standing, BlackBerry is well-positioned to drive shareholder value in the coming fiscal year.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.