To The Moon

$BlackBerry(BB)$ is expected to report its quarterly earnings for fiscal Q4 2025 on 02 April 2025 after the market close.

The earnings per share have been expected to come in below 1 cents which represent a decline of more than 66.66% compared to same period last year.

In the last reported quarter, where we see that BB cost-cutting measures are working, the adjusted EBITDA (from continuing and discontinued operations) of $23 million rose from $18 million in the year-ago quarter. The company had expected adjusted EBITDA to be $0-$10 million.

BlackBerry (BB) Last Positive Earnings Call Have Their Share Price Rise 26.51%

BlackBerry had a positive earnings call on 19 Dec 2024 which saw its share price rise by 26.51% since.

The earnings call reflects a positive sentiment with BlackBerry's strong financial turnaround, impressive growth in both the IoT and Cybersecurity divisions, and strategic moves such as the sale of Cylance. However, challenges remain in the automotive market and licensing revenue fluctuations.

BlackBerry (BB) Guidance On IoT Revenue

During the BlackBerry Q3 2025 earnings call, the company provided a comprehensive overview of its financial performance and future guidance. BlackBerry reported revenue of $162 million, surpassing the upper end of its guidance range, with a gross margin improvement to 74%. The IoT division achieved revenue of $62 million, marking 13% year-over-year growth, driven by strong performance in automotive royalties and development seat licenses. The Cybersecurity division, including Cylance, reported $93 million in revenue, reflecting 7% sequential growth, while the Secure Communications division alone achieved 10% growth.

BlackBerry also reported positive EBITDA of $23 million and non-GAAP EPS of $0.02. Looking ahead to Q4, BlackBerry anticipates Secure Communications revenue between $62 million and $66 million, with EBITDA between $4 million and $6 million. IoT revenue is expected to range from $60 million to $65 million, and Licensing revenue is projected at approximately $4 million, contributing to a total company adjusted EBITDA forecast of $10 million to $20 million.

Key trends to watch for Q2 2025

Cybersecurity Growth: Can BlackBerry stabilize its cybersecurity division amid competition (CrowdStrike, Palo Alto) and economic headwinds? Cybersecurity division, including both Secure Communications and Cylance, delivered revenue of $93 million with a 7% sequential growth. The division achieved $8 million of EBITDA, a $14 million sequential improvement.

IoT Momentum: Adoption of QNX in automotive/EVs (design wins with automakers) and edge computing. IoT division delivered revenue of $62 million, a 13% year-over-year and sequential growth. The division also achieved an 85% gross margin and $18 million of EBITDA, representing 38% sequential growth.

Profitability: Progress toward CEO John Chen’s goal of profitability by FY2025 (ended Feb 2025). BlackBerry achieved positive EBITDA of $23 million and non-GAAP EPS of $0.02, along with positive operating and free cash flow of $3 million, marking the first positive cash flow in 12 quarters.

Licensing & Partnerships: Potential IP monetization or strategic deals (e.g., IoT collaborations). BlackBerry signed a definitive agreement with Arctic Wolf for the sale of Cylance, which is expected to strengthen the balance sheet and improve profitability.

Secure Communications division showed strong performance with an 8% year-over-year increase in ARR to $215 million and a dollar-based net retention rate of 95%.

Factors Influencing Fiscal Q4 2025

Automotive Industry Health: BlackBerry’s IoT revenue depends on auto production rates and EV adoption. Chip shortages or recessions could delay projects.

Despite IoT's success, the automotive space remains a difficult backdrop, affecting design program activations at OEMs.

Cybersecurity Demand: Enterprise spending on threat detection and managed services. QNX's revenue mix shifts quarter-to-quarter, causing fluctuations in development seat licenses and challenges in maintaining consistent revenue growth.

Competition: Pressure from larger players in cybersecurity and IoT.

Cost Management: Success in reducing operating expenses (layoffs, restructuring). Licensing division revenue is expected to decrease in Q4, with projected revenue of $4 million, down from $7 million in Q3.

Macro Risks: Economic slowdowns or reduced IT budgets.

BlackBerry (BB) Price Target

Based on 3 Wall Street analysts offering 12 month price targets for BlackBerry in the last 3 months. The average price target is $5.25 with a high forecast of $7.00 and a low forecast of $4.00. The average price target represents a 39.26% change from the last price of $3.77.

We could be seeing a stronger EBITDA if BB continue to do well in the cost cutting, and I am looking forward to the IoT revenue contribution in this upcoming earnings reporting.

BB share price might be influenced by improvements in cybersecurity ARR (annual recurring revenue) and IoT design wins, and BlackBerry’s FY2025 profitability target is critical. EV production forecasts and QNX adoption rates.

Technical Analysis - Exponential Moving Average (EMA)

We could see a reversal if BB could show an earnings surprise with stronger IoT revenue, its current share price is above 200-day and we might see a reversal of the RSI away from the oversold region.

The current momentum is weak but if investors sentiment start to pick up on the IoT revenue, we could possibly see a gap up if the earnings beat estimate with a stronger FY 2025 guidance.

For now the current share price looks like a potential buy, but we need to understand if investors sentiment start to pick up when we are near the 02 April Liberation Day.

Summary

For fiscal Q4 2025, focus on BlackBerry’s progress in stabilizing cybersecurity, scaling IoT (especially QNX), and achieving profitability. The stock’s performance will hinge on execution and macro conditions.

Analysts are cautious about near-term growth but see long-term potential in IoT (QNX in cars, robotics, medical devices). Slower-than-expected cybersecurity turnaround and reliance on automotive sector timing.

One of the important risk is on the automotive sector is the auto tariffs, so if BB could be able to navigate this, then there could be a positive move on BB share price post earnings.

Appreciate if you could share your thoughts in the comment section whether you think BB could surprise with an earnings beat and stronger guidance for FY 2025.

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.