BlackBerry revenue rises 26% as QNX and licensing lift fiscal Q2
Adjusted EPS beat BlackBerry's June outlook, while the company forecast a sharp licensing revenue decline in the next quarter.
Julian Okafor
An earnings report released Sept. 24 shows that a licensing surge supplied nearly half the increase in quarterly sales. BlackBerry Limited TSEBB NYSEBB, the Waterloo, Ont., supplier of QNX vehicle software and secure communications systems, reported US$163.3 million in revenue and US$0.07 in adjusted basic earnings per share for its fiscal second quarter ended Aug. 31. Revenue grew 26 per cent year over year, while BlackBerry expects licensing sales to fall from US$22.1 million to about US$6 million next quarter.
The adjusted earnings figure topped BlackBerry's June 25 forecast for non-GAAP basic earnings of US$0.03 to US$0.04 a share. Sales also exceeded the US$137 million to US$148 million range the company set in June. The company reported US$33.9 million in GAAP net income, compared with US$13.3 million in the year-earlier quarter; its GAAP basic earnings were US$0.06 a share.
The NYSEBB quote showed a US$8.38 close at 4:00 p.m. EDT on Sept. 23, before the earnings release. The TSEBB quote showed a C$11.84 close at 4:00 p.m. EDT the same day. The release followed those closes, so neither quote reflects trading on the results.
BlackBerry raised its fiscal 2027 revenue outlook to US$616 million to US$636 million. Its June range was US$594 million to US$621 million. The mix changed with the total: its QNX outlook rose, its Secure Communications outlook fell, and it now expects more licensing revenue. Its next forecast is for the quarter ending Nov. 30, when management expects overall revenue of US$143 million to US$154 million.
Licensing Supplies Much Of The Increase
The investor supplement shows that revenue rose by US$33.7 million from US$129.6 million in the August 2025 quarter. Licensing contributed US$15.5 million of that increase, rising to US$22.1 million from US$6.6 million. QNX contributed US$17.2 million, while Secure Communications added US$1.0 million.
The combined QNX and Secure Communications businesses generated US$141.2 million, up from US$123.0 million a year earlier. That is growth of about 15 per cent, below the company's 26 per cent headline rate because licensing grew faster. BlackBerry's forecast of about US$6 million in licensing revenue for the November quarter is the clearest test of how much of the August quarter's increase persists.
A year earlier, BlackBerry's Sept. 25, 2025 release reported US$129.6 million in revenue and US$0.04 in adjusted basic earnings per share. This year's US$0.07 adjusted figure is also above the US$0.04 BlackBerry reported for its May 2026 quarter.
BlackBerry generated US$29.3 million in operating cash flow in the August 2026 quarter, against US$3.4 million a year earlier. Cash and investments reached US$447.1 million at Aug. 31, up from US$422.9 million at May 31. Adjusted EBITDA rose to US$47.0 million from US$25.9 million a year earlier. GAAP operating income reached US$33.6 million from US$11.5 million.
QNX Growth Lifts The Annual Forecast
QNX revenue rose 27 per cent to US$80.3 million in the quarter ended Aug. 31. Its adjusted EBITDA increased to US$29.0 million from US$20.5 million a year earlier. The division's adjusted gross margin rose to 87 per cent from 83 per cent, according to BlackBerry's supplement. The company says an Alloy Kore software design win added more than US$100 million to its QNX royalty backlog, though that backlog figure is future potential rather than this quarter's recognized sales.
"QNX delivered record performance in the quarter, driven by strength in our core automotive business," BlackBerry chief executive John J. Giamatteo said in the Sept. 24 release.
BlackBerry now projects US$315 million to US$325 million in fiscal 2027 QNX revenue. Its June range was US$295 million to US$312 million. Its first-quarter release had already reported US$72.3 million in QNX sales for the three months ended May 31, after the division had posted US$63.1 million in the August 2025 quarter.
November Quarter Tests The Mix
Secure Communications revenue reached US$60.9 million for the August 2026 quarter, up 2 per cent from US$59.9 million a year earlier. It fell from US$73.6 million in the May quarter. Its adjusted EBITDA fell to US$8.0 million from US$9.7 million a year earlier. Dollar-based net retention slipped to 91 per cent from 93 per cent in August 2025. Annual recurring revenue rose to US$221 million from US$213 million over the same period.
BlackBerry cut its fiscal 2027 Secure Communications revenue outlook to US$260 million to US$270 million. The June range was US$270 million to US$280 million. It raised its licensing forecast to about US$41 million from about US$29 million. The revised ranges show that stronger QNX and licensing expectations are offsetting a softer annual view for secure communications.
For the quarter ending Nov. 30, BlackBerry expects QNX revenue of US$82 million to US$88 million. Adjusted basic earnings are forecast at US$0.04 to US$0.05 a share. Its licensing forecast of about US$6 million leaves that quarter as the dated test of whether QNX can support group revenue after the August licensing spike.
