BlackBerry Q4 Earnings: Secure Communications And Licensing Segments Drive Impressive Performance, Stock Slides On Dismal Guidance

BlackBerry Ltd BB reported fourth-quarter financial results on Wednesday. Here’s a look at the key metrics from the quarter.

Q4 Earnings: BlackBerry reported fourth-quarter revenue of $141.70 million, which topped the analyst consensus estimate of $132.83 million.

The company reported fourth-quarter adjusted earnings of $0.03, beating the analyst consensus estimate of $0.01.

Also Read: BlackBerry Growth Hinge On IoT, Secure Communications Despite Valuation Concerns: Analyst

QNX revenue (formerly “IoT”) growth was flat year over year, exceeding the guidance range at $65.8 million. The segment gross margin decreased by 200 bps to 83%.

Secure Communications (formerly “Cybersecurity”) revenue exceeded previously provided guidance at $67.3 million, and the segment gross margin was 64%.

Licensing revenue exceeded guidance at $8.6 million.

Total company gross margin was 73.5% in the quarter, down by 640 bps. Operating cash flow improved by $57 million year-over-year to $42 million. BlackBerry ended the quarter with $410 million in cash, cash equivalents, and short- and long-term investments.

CEO John J. Giamatteo noted that BlackBerry closed out this transformational fiscal year with another quarter of strong financial performance from all three divisions: QNX, Secure Communications, and Licensing. It also took a big step forward by completing the sale of the Cylance business to Arctic Wolf, a win-win for all parties and significantly strengthening its balance sheet. It started the year by delivering profitability and positive cash flow.

Guidance: BlackBerry expects first-quarter revenue of $107 million—$115 million versus analyst estimates of $127.99 million. The company anticipates quarterly QNX revenue of $51 million—$55 million, Secure Communications revenue of $50 million—$54 million, and Licensing revenue of approximately $6 million. The company anticipates an adjusted EPS of ($0.01)-Breakeven versus the analyst estimate of $0.01.

BlackBerry expects a fiscal 2026 revenue of $504 million—$534 million, versus the analyst estimate of $546.34 million. The company anticipates an adjusted EPS of $0.08-$0.10, versus the analyst estimate of $0.10.

Price Action: BB stock is down 2.68% at $3.63 premarket at last check Wednesday.

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