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“Breaking Down BlackBerry: Cybersecurity Wins, Revenue Woes, and the Race to Rule IoT”

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  • Financial Performance: Licensing and Other revenue amounts to $4 million. GAAP operating loss is $47 million.
  • Cybersecurity Revenue: Secusmart and Spark platforms contribute to cybersecurity revenue of $79 million. Cybersecurity Annual Recurring Revenue (ARR) reaches $279 million. Cybersecurity billings total $74 million.
  • Strategic Decisions: Decision to separate IoT and Cybersecurity units into standalone divisions to streamline operations and enhance focus.

BlackBerry Limited’s latest earnings report demonstrates a strong financial performance, exceeding earnings expectations but falling short on revenue estimates. The company’s focus on cybersecurity and strategic partnerships has driven its growth, particularly in the IoT and automotive sectors. The report highlights key business highlights, strategic announcements, and a breakdown of revenue by geography. Additionally, the review explores the performance of BlackBerry’s cybersecurity contracts and portfolio diversification, the market performance of its Cylance offering, and the momentum of its QNX platform in the IoT industry.

Q2 2024 Performance

The company’s cybersecurity revenue, which includes its Secusmart and Spark platforms, reached $79 million with a gross margin of 54%. Cybersecurity Annual Recurring Revenue (ARR) amounted to $279 million, while cybersecurity billings totaled $74 million. Licensing and Other revenue amounted to $4 million. BlackBerry reported a non-GAAP operating loss of $28 million and a GAAP operating loss of $47 million. The revenue breakdown by geography reveals a decline of 15.3% in North America for the three months ended August 31, 2023. However, the overall six-month comparison demonstrates substantial growth of 50.3%, driven by a significant surge in North American revenue. Europe, the Middle East, and Africa experienced a decline in the short and long term, while other regions maintained relative stability.

Geography Three Months

Ended August 31, 2023

Six Months

Ended August 31, 2023

Three Months

Ended August 31, 2022

Six Months

Ended August 31, 2022

% Change



% Change (Six


North America $72 million $389 million $85 million $174 million -15.30% 123.60%
Europe, Middle East and Africa $39 million $76 million $61 million $121 million -36.10% -37.20%
Other regions $21 million $40 million $22 million $41 million -4.50% -2.40%
Total $132 million $505 million $168 million $336 million -21.40% 50.30%


Strategic Positioning and QNX 8.0 Real-Time Operating System

BlackBerry’s success in acquiring new design wins and achieving positive quarters in its Cylance offering indicates a competitive edge, especially in the Small and Medium-sized Business (SMB) segment. The company’s strategic partnerships with Foxconn’s MIH consortium and Mitsubishi Electric demonstrate its commitment to innovative technologies in electric vehicle platforms and advanced in-cabin systems. The imminent launch of BlackBerry’s QNX 8.0 real-time operating system is expected to significantly influence the company’s trajectory, positioning it as a leader in the automotive and embedded systems domains. The QNX platform’s adaptability to industry challenges and responsiveness to market demands will be crucial in assessing BlackBerry’s long-term viability in the IoT landscape. BlackBerry’s appointment of John Giamatteo as CEO and the decision to separate its IoT and Cybersecurity units into standalone divisions underscores the company’s commitment to streamlining operations and enhancing focus in respective markets. This move is expected to unlock shareholder value and drive more agile decision-making.

IVY Ecosystem and Industry Traction

The company’s IVY ecosystem is gaining traction, as evidenced by its selection by Mitsubishi Electric and ongoing proof-of-concept trials with major OEMs. With over 40 partners actively building on IVY and several pre-integrated solutions deployed, BlackBerry is establishing a comprehensive ecosystem in the connected vehicle and intelligent transportation systems industry.

Future Outlook

Looking ahead, it will be essential to closely monitor the revenue growth of QNX and the progress and closure of perpetual government contracts within the cybersecurity business. Furthermore, tracking Cylance’s market penetration in the SMB segment will provide insights into BlackBerry’s competitive position in the cybersecurity market.


In conclusion, BlackBerry Limited’s strong financial performance, strategic partnerships, and focus on cybersecurity and IoT industry position it for future growth. The company’s ability to execute on its cybersecurity contracts, expand its market share with Cylance, and capitalize on the momentum of the QNX platform will be crucial for sustained success. With these factors in mind, we recommend a “Buy” rating for BlackBerry Limited’s stock. Investors are advised to conduct thorough due diligence, considering both optimistic and pessimistic scenarios, to make informed decisions aligned with their risk tolerance and investment objectives.

Disclosure: We don’t hold any position in the stock and this is not a recommendation of any kind as investing carries risk.

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