EPS of $0.00 increased by 104.5% from previous year
Gross margin of 74.2%
Net income of 1.90M
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BlackBerry Limited (BB.TO) QQ1 2026 Results: Revenue Decline, Margin Resilience and Robust Liquidity in a Software Infrastructure Play
Executive Summary
- Quantum of QQ1 2026 results: BlackBerry reported revenue of USD 121.7 million with a robust gross margin of ~74.2%. Despite a positive operating line of USD 2.0 million, reported EBITDA is USD 13.5 million, suggesting management applies broader adjustments to EBITDA versus the core operating metric. Net income stood at USD 1.9 million, delivering basic EPS of USD 0.0032. YoY revenue declined by ~15.5% and QoQ declined by ~15.4%, signaling ongoing top-line headwinds as BlackBerry continues to pivot its mix toward high-margin software, licensing, and security offerings rather than traditional hardware or legacy services.
- Profitability and liquidity dynamics: The company generated a non-cash heavy but ultimately cash-positive profile on a balance sheet basis, with USD 292.5 million in cash and cash equivalents and a net cash position of USD 266.2 million. However, free cash flow was negative by USD 18.0 million driven primarily by working capital movements and ongoing R&D and SG&A investments. Balance sheet remains solid with total assets of USD 1.210 billion and total stockholders’ equity of USD 725.1 million.
- Strategic positioning and near-term outlook: BlackBerry’s strategy centers on expanding its cybersecurity software stack (Cylance AI-enabled offerings), IoT and automotive software platforms (QNX, IVY), and licensing from its patent portfolio. The quarter underscores margin resilience in a declining revenue environment, aided by a high gross margin and ongoing cost discipline, but earnings visibility hinges on stabilizing or growing revenue and converting EBITDA into meaningful cash flow. Management commentary (where available) emphasizes continued investment in core growth vectors, while the cash balance affords optionality for strategic partnerships, capex, or selective licensing opportunities.
Key Performance Indicators
Revenue
121.70M
QoQ: -15.43% | YoY:-15.46%
Gross Profit
90.30M
74.20% margin
QoQ: -14.73% | YoY:7.53%
Operating Income
2.00M
QoQ: 132.26% | YoY:107.15%
Net Income
1.90M
QoQ: 127.14% | YoY:104.53%
EPS
0.00
QoQ: 127.12% | YoY:104.49%
Revenue Trend
Margin Analysis
Key Insights
Debt) USD -266.2m
Note on EBITDA figure: Reported EBITDA USD 13.5m appears not to align perfectly with Operating Income USD 2.0m and Depreciation & Amortization USD 5.7m, suggesting non-cash or non-recurring adjustments embedded in EBITDA not reconciled in the data provided.
Financial Highlights
Revenue: USD 121.7m; YoY -15.46%, QoQ -15.43%
Gross Profit: USD 90.3m; Gross Margin ~74.20%; YoY +7.53%, QoQ -14.73%
Operating Income: USD 2.0m; Operating Margin ~1.64%; YoY +107.15%, QoQ +132.26%
EBITDA: USD 13.5m; EBITDA Margin ~11.10% (reported EBITDA vs. reconciliation notes may imply adjustments)
Net Income: USD 1.9m; Net Margin ~1.56%; YoY +104.53%, QoQ +127.14%
EPS (Diluted): USD 0.0032; Weighted Avg Shares Diluted: ~600.8m
Cash Flow: Operating Cash Flow (OCF) = USD -18.0m; Free Cash Flow = USD -18.0m; Capex = USD -0.9m; Net Cash End of Period = USD 292.5m; Net Debt = USD -266.2m
Balance Sheet (USD): Total Assets USD 1.210B; Cash and Equivalents USD 292.5m; Total Current Assets USD 533.2m; Total Liabilities USD 485.3m; Total Stockholders’ Equity USD 725.1m; Goodwill / Intangibles USD 521.1m; Long-Term Debt USD 221.9m; Net Debt (Cash - Debt) USD -266.2m
Note on EBITDA figure: Reported EBITDA USD 13.5m appears not to align perfectly with Operating Income USD 2.0m and Depreciation & Amortization USD 5.7m, suggesting non-cash or non-recurring adjustments embedded in EBITDA not reconciled in the data provided.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
121.70M
-15.46%
-15.43%
Gross Profit
90.30M
7.53%
-14.73%
Operating Income
2.00M
107.15%
132.26%
Net Income
1.90M
104.53%
127.14%
EPS
0.00
104.49%
127.12%
Key Financial Ratios
Net Income vs. Revenue
Expense Breakdown
Management Commentary
Transcript data not provided in the input. No management quotes from the QQ1 2026 earnings call are available in the provided material. Once the call transcript is available, the highlights can be aligned by themes (strategy, operations, market conditions, and guidance) with direct quotes and attribution.
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Forward Guidance
No formal forward guidance was included in the provided data. Given the revenue decline in QQ1 2026 and the ongoing investment in R&D and strategic platforms (Cylance-based cybersecurity, QNX, IVY), investors should monitor: (1) revenue trajectory by segment (Cybersecurity vs Licensing vs IoT/Automotive), (2) progression toward higher-margin software/licensing mix, (3) working capital dynamics affecting cash flow, and (4) any formal guidance or updates on government/enterprise security demand and customer concentration. If BlackBerry can stabilize or grow ARR/recurring revenue, gross margin resilience could translate into improved operating leverage and better free cash flow over the next few quarters.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
BB.TO Focus
74.20%
N/A
N/A
N/A
AC.TO
18.40%
-2.08%
-5.12%
-11.46%
LSPD.TO
40.70%
-16.60%
-1.49%
-15.11%
SHOP.TO
49.50%
8.60%
-6.17%
-45.23%
SU.TO
47.70%
17.60%
3.77%
10.22%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
Assessment: Cautiously constructive with caveats. The QQ1 2026 results demonstrate margin resilience in a revenue-constrained environment and a robust liquidity profile that supports strategic initiatives and potential partnerships or licensing deals. The key overhang is the top-line trajectory; without a stabilization or growth in revenue, converting EBITDA strength into sustained free cash flow remains challenging. The company’s IP-heavy, software-centric portfolio (Cylance, QNX, IVY, Jarvis, etc.) offers optionality that could unlock longer-term value if BlackBerry can accelerate recurring revenue and expand licensing streams. Near-term catalysts include portfolio monetization opportunities, customer wins in cybersecurity and automotive platforms, and potential strategic collaborations that improve cash flow generation. Overall stance: Neutral-to-Slightly-Positive pending clearer path to revenue stabilization and meaningful cash flow improvement, with emphasis on margin quality, ARR growth, and balance-sheet strength as primary risk-adjusted upside drivers.
Key Investment Factors
Growth Potential
Long-term growth opportunities lie in expanding Cylance-powered cybersecurity offerings (EPP, MDR, XDR), scaling BlackBerry IVY data platform across industries, and monetizing QNX/ADAS software licenses in automotive/industrial sectors; potential upsell of UEBA (Persona) and secure communications (BBM Enterprise) within enterprise and government segments.
Profitability Risk
Key risks include sustained revenue decline needing a turnaround in customer wins, competition from larger cybersecurity incumbents, macro volatility affecting enterprise IT budgets, and execution risk in expanding AI-enabled security solutions. Currency exposure (CAD/USD) and cadence of licensing vs services revenue may impact margin progression.
Financial Position
A strong liquidity stance with USD 292.5m cash and a net cash position of USD 266.2m provides strategic optionality for partnerships, share buybacks, or targeted acquisitions. However, negative free cash flow indicates working capital and investment needs that must be managed to translate profitability into cash generation.
SWOT Analysis
Strengths
High gross margin (~74%) indicating a favorable product mix in software/licensing
Solid liquidity position: USD 292.5 million in cash and a net cash position (~USD 266 million)
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