BlackBerry Limited (NYSE:BB) is scheduled to report its second-quarter fiscal 2025 results on September 26th. Investors will be closely watching to see if the company's restructuring and cost-cutting efforts have helped to improve its financial performance.
BlackBerry's Recent Performance
In the last reported quarter, BB's adjusted loss per share of 3 cents was narrower than the company's estimate of a loss of 4-6 cents. It reported non-GAAP earnings of 6 cents per share in the year-ago quarter. The Zacks Consensus Estimate was pegged at a loss of 4 cents per share. Quarterly revenues were $144 million compared with the prior-year quarter's figure of $373 million. However, the top line surpassed the company's guidance of $130-$138 million. Software product revenues contributed 85% to total revenues, while professional services contributed 15%.
The company's earnings surpassed the Zacks Consensus Estimate in three of the trailing four quarters while missing the other, with the average earnings surprise of 81.25%.
Key Drivers for BlackBerry's Q2 2025 Earnings
QNX Platform Gains Traction
Apart from Auto, the rapid adoption of the QNX platform in the General Embedded market is a positive factor. Continued design win momentum is anticipated to have further strengthened the QNX royalty backlog. Improving revenues from royalties and professional services is likely to have acted as a tailwind.
Cybersecurity Business
Steady momentum in the SecuSmart business, as well as improving annual recurring revenues are likely to have benefited the Cybersecurity business. Steady demand for Blackberry's Cylance is another tailwind.
BlackBerry's Q2 2025 Revenue Outlook
The company expects fiscal second-quarter revenues to be in the range of $136-$144 million. For the Cybersecurity business, revenues are estimated to be in the band of $82-$86 million.
For IoT business, revenues are now projected in the band of $50-$54 million. Though management expects an improvement in development seat license revenues in the second quarter, the headwinds faced by automakers in delivering software development programs are likely to have remained an overhang on the QNX business. Licensing & Other revenues are expected to be approximately $4 million.
Analyst Expectations
While BlackBerry's recent performance has been mixed, analysts are generally expecting the company to report a small loss in the second quarter.
BlackBerry Ltd (BB, Financial) is set to release its Q2 2025 earnings on Sep 26, 2024. The consensus estimate for Q2 2025 revenue is $141.42 million, and the earnings are expected to come in at -$0.04 per share. The full year 2025's revenue is expected to be $604.35 million and the earnings are expected to be -$0.14 per share.
Outlook for BlackBerry
BlackBerry is facing a number of challenges, including intense competition in the cybersecurity and automotive markets. However, the company has taken steps to reduce costs and restructure its operations. It remains to be seen whether these efforts will be enough to drive profitability.
The company's focus on its core businesses, namely cybersecurity and automotive, should help it to achieve sustainable growth in the long term. Investors will be looking for signs that BlackBerry is making progress on its turnaround strategy.
A Look at the Future
BlackBerry's Q2 2025 earnings report will be an important event for the company. Investors will be looking for signs of progress in its key growth areas, namely cybersecurity and automotive.
If BlackBerry can deliver on its promises, it has the potential to be a strong performer in the years to come. However, if it fails to meet expectations, the company's shares could come under pressure.
The Bottom Line
BlackBerry is a company in transition, and its Q2 2025 earnings report will provide insights into its progress.
Investors should be prepared for a mixed bag of results. However, if BlackBerry can demonstrate that it is making progress on its turnaround strategy, the company's shares could see a positive reaction.
