BlackBerry Reports Q3 Fiscal 2025 Results with $143 Million Revenue, Net Loss of $11 Million

BlackBerry Limited reported its financial results for the third quarter of fiscal 2025, revealing a revenue of $143 million, a decrease of 6% from $152 million in the same period last year. The company incurred a net loss of $11 million, or $0.02 per share, compared to a loss of $21 million, or $0.04 per share, in the prior year. The decline in revenue was primarily attributed to a significant drop in the Secure Communications segment, which saw a $17 million decrease, largely due to reduced product revenue from Secusmart. In contrast, the IoT segment experienced a revenue increase of $7 million, driven by higher BlackBerry QNX royalty revenue.

In terms of operational metrics, BlackBerry's gross margin for the quarter was approximately $112 million, down from $119 million a year earlier, while the gross margin percentage remained stable at 78.3%. Operating expenses totaled $93 million, a reduction from $101 million in the previous year, reflecting cost-cutting measures and a decrease in salaries and benefits. The company reported an operating income of $19 million, down from $23 million in the same quarter last year.

Strategically, BlackBerry has made significant organizational changes, including the classification of its Cylance cybersecurity business as a discontinued operation. This decision follows the company's announcement on October 16, 2024, to explore opportunities for the Cylance business, which has been underperforming. On December 15, 2024, BlackBerry entered into an agreement to sell its Cylance endpoint security assets to Arctic Wolf for $160 million in cash and equity, marking a pivotal shift in its business focus.

The company also reported a decrease in total cash, cash equivalents, and investments, which stood at $266 million as of November 30, 2024, down from $298 million at the end of the previous fiscal year. This decline was primarily due to changes in working capital and a reduction in short-term investments. BlackBerry's total liabilities decreased to $584 million from $619 million, reflecting a strategic effort to streamline operations and reduce costs.

Looking ahead, BlackBerry has adjusted its revenue guidance for fiscal 2025, now expecting total revenue from continuing operations to be in the range of $517 million to $526 million, down from previous estimates. The company anticipates that its Secure Communications revenue will be between $62 million and $66 million in the fourth quarter of fiscal 2025, while IoT revenue is expected to range from $60 million to $65 million. The outlook reflects ongoing challenges in the cybersecurity market and a strategic pivot towards its IoT and software services segments.