Blackberry (BB) Q3 2025 earnings summary

Executive summary

• Achieved positive operating and free cash flow for the first time in 12 quarters, ahead of expectations, with all divisions (IoT, cybersecurity, licensing) delivering profitability and exceeding guidance for revenue and margins.

• Announced a definitive agreement to sell Cylance to Arctic Wolf for $160M in cash and shares, expected to close in Q4 FY25, aligning with strategic direction and strengthening the balance sheet.

• Focused on core IoT and Secure Communications businesses, with strategic capital allocation and improved fundamentals.

Financial highlights

• Total revenue reached $162 million, surpassing the upper end of guidance, with recurring software product revenue at 80%.

• Gross margin improved to 74% sequentially and year-over-year; adjusted EBITDA was $23 million, and non-GAAP EPS was $0.02.

• Operating and free cash flow were both positive at $3 million, a $34 million year-over-year improvement; total cash and investments at $266 million.

• Non-GAAP OPEX was $101 million, $29 million below the prior baseline.

Outlook and guidance

• Full-year FY25 revenue guidance is $517–$526 million; Q4 revenue guidance is $126–$135 million.

• Q4 IoT revenue expected at $60–$65 million; Secure Communications at $62–$66 million; Licensing at ~$4 million.

• Adjusted EBITDA guidance for Q4: $10–$20 million; FY25: $60–$70 million; non-GAAP basic EPS for FY25 expected between $(0.02) and breakeven.

• Full-year IoT revenue guidance raised to $230–$235 million.