Blackberry (BB) Q1 2025 earnings summary

Executive summary

• Achieved another solid quarter with Q1 FY25 revenue of $144 million, both IoT and Cybersecurity divisions delivering above expectations and sequential improvements in free cash usage, Adjusted EBITDA, and non-GAAP EPS.

• Significant cost reductions achieved, with $125 million realized to date and a $21 million improvement in non-GAAP OPEX compared to baseline.

• Continued progress in separating IoT and Cybersecurity into standalone divisions, driving cost efficiencies and operational agility.

• Net cash used in operations improved significantly year-over-year, with free cash usage improving for the third consecutive quarter.

• Exceeded guidance for adjusted EBITDA and non-GAAP EPS; adjusted EBITDA was -$7 million and non-GAAP basic loss per share was $0.03.

Financial highlights

• Total revenue was $144 million, exceeding the upper end of guidance; IoT revenue was $53 million, Cybersecurity $85 million, and Licensing & Other $6 million.

• Gross margin was 67% overall; IoT gross margin was 81%, Cybersecurity 59%, and Licensing & Other 67%.

• Non-GAAP operating loss was $12 million; Adjusted EBITDA was -$7 million; non-GAAP EPS was -$0.03.

• Total cash, cash equivalents, and investments stood at $283 million at quarter end.

• Free cash usage improved sequentially for the third consecutive quarter to $16 million.

Outlook and guidance

• Full-year IoT revenue expected in the range of $220 million–$235 million; Q2 IoT revenue guidance is $50–$54 million.

• Full-year Cybersecurity revenue expected in the range of $350 million–$365 million; Q2 guidance is $82–$86 million.

• Licensing & Other FY25 revenue outlook: approximately $4 million per quarter.

• Adjusted EBITDA for the full year expected to be break-even to $10 million; non-GAAP EPS between -$0.03 and -$0.07.

• On track to achieve non-GAAP profitability and positive cash flow in Q4 FY25.