EPS of $-0.03 increased by 55.3% from previous year
Gross margin of 64.8%
Net income of -19.00M
"John Giamatteo: 'The hard work that the team has done with managing cost is really paying off, with operating expenses now significantly lower than prior year and below $100 million a quarter.'" - John Giamatteo
BlackBerry Limited (BB) Q2 2025 Results: Progress in Strategy and Promise of Growth
Executive Summary
BlackBerry Limited, a key player in cybersecurity and IoT solutions, reported revenue of $145 million for Q2 2025, marking a 10% year-over-year increase. The operational strategies implemented have led to a significant reduction in operating expenses, allowing the company to achieve breakeven in adjusted EBITDA, earlier than anticipated. Both the Cyber and IoT divisions demonstrated notable revenue growth with increased demand highlighting BlackBerry's strategic focus on its core markets. Management conveyed optimism for maintaining this upward momentum, reflecting a solid path towards enhanced profitability and cash flow management moving forward.
Key Performance Indicators
Revenue
145.00M
QoQ: 0.72% | YoY:9.85%
Gross Profit
94.00M
64.83% margin
QoQ: 11.94% | YoY:10.59%
Operating Income
-21.00M
QoQ: 24.98% | YoY:55.32%
Net Income
-19.00M
QoQ: 54.75% | YoY:54.76%
EPS
-0.03
QoQ: 54.78% | YoY:55.28%
Revenue Trend
Margin Analysis
Key Insights
**Revenue:** $145 million (YoY: +10%, QoQ: +1%)
**Gross Profit:** $94 million (Gross Margin: 65%)
**Operating Income:** -$21 million (Operating Margin: -14.5%)
**Net Income:** -$19 million (Net Margin: -13.1%)
**EBITDA:** -$8 million
Financial Highlights
Financial Highlights:
- Revenue: $145 million (YoY: +10%, QoQ: +1%)
- Gross Profit: $94 million (Gross Margin: 65%)
- Operating Income: -$21 million (Operating Margin: -14.5%)
- Net Income: -$19 million (Net Margin: -13.1%)
- EBITDA: -$8 million
- EPS: -$0.0322
Cash Flow:
- Net Cash from Operations: -$13 million
- Cash at Quarter End: $188 million
Management explained that the improved cost structure, with Q2 operating expenses down to $99 million, reflects successful initiatives aimed at increasing operational efficiency, allowing BlackBerry to convert cost savings into strategic investments for growth.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
145.00M
9.85%
0.72%
Gross Profit
94.00M
10.59%
11.94%
Operating Income
-21.00M
55.32%
24.98%
Net Income
-19.00M
54.76%
54.75%
EPS
-0.03
55.28%
54.78%
Key Financial Ratios
currentRatio
1.44
grossProfitMargin
64.8%
operatingProfitMargin
-14.5%
netProfitMargin
-13.1%
returnOnAssets
-1.46%
returnOnEquity
-2.6%
debtEquityRatio
0.34
operatingCashFlowPerShare
$-0.02
freeCashFlowPerShare
$-0.03
priceToBookRatio
1.9
priceEarningsRatio
-18.26
Net Income vs. Revenue
Expense Breakdown
Management Commentary
Key Management Insights:
- John Giamatteo (CEO): 'Both the IoT and Cybersecurity divisions delivered solid year-over-year as well as sequential revenue growth.' This reflects an ongoing commitment to optimizing product lines and capitalizing on market opportunities.
- Tim Foote (CFO): 'We are delighted to be breakeven ahead of schedule in Q2. Cash usage continues to improve, with operating cash usage being $43 million better than the same quarter last year.' This notable reduction underscores BlackBerry's emphasis on financial prudence and operational efficiency.
John Giamatteo: 'The hard work that the team has done with managing cost is really paying off, with operating expenses now significantly lower than prior year and below $100 million a quarter.'
â John Giamatteo
Tim Foote: 'Operating cash usage came in better than expected, improving by $2 million sequentially to $13 million. This is $43 million better than for Q2 last year.'
â Tim Foote
Forward Guidance
Management expects sequential revenue increases in both the IoT and Cybersecurity divisions, projecting IoT revenue for Q3 to be between $56 million and $60 million. For Cyber, the anticipated revenue range is $86 million to $90 million. Additionally, the overall guidance suggests anticipated improvement in adjusted EBITDA and a trajectory toward profitability, showcasing management's focus on disciplined capital allocation and operational management. Investors should monitor the execution of product launches and the expansion of market opportunities within cybersecurity and IoT.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
BB Focus
64.83%
-14.50%
-2.60%
-18.26%
AFRM
69.50%
-0.50%
2.88%
61.06%
SQ
35.60%
8.65%
1.01%
50.48%
PATH
80.00%
-32.70%
-4.70%
-20.07%
TOST
23.00%
0.73%
1.09%
252.78%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
While BlackBerry's recent earnings reflect challenges in profitability and market competition, its initiatives in operational efficiency and cost management present a promising outlook for stability and growth. Strategic focus on diversifying its product portfolio with emerging technologies in IoT and AI positions BlackBerry favorably within the tech sector. Investors should pay attention to the upcoming product launches and the expected next phases of revenue growth as these will be crucial for realizing a definitive turn towards sustained profitability.
Key Investment Factors
Growth Potential
BlackBerry's positioning in the cybersecurity and IoT sectors presents substantial growth prospects, particularly through strategic partnerships and product innovation.
Profitability Risk
Risks include sustained competitive pressures in the cybersecurity landscape, potential delays in development programs, and market volatility which could impact revenue generation.
Financial Position
The company maintains a strong liquidity position with $188 million in cash, but bears operational losses that necessitate ongoing scrutiny.
SWOT Analysis
Strengths
Strong product portfolio with a focus on cybersecurity and IoT