Mr. John Chen reports

BLACKBERRY REPORTS FIRST QUARTER FISCAL YEAR 2024 RESULTS

BlackBerry Ltd. today released its financial results for the three months ended May 31, 2023 (all figures in United States dollars and U.S. GAAP (generally accepted accounting principles), except where otherwise indicated).

First quarter fiscal 2024:

• Total company revenue of $373-million;
• IoT (Internet of Things) revenue of $45-million;
• Cybersecurity revenue of $93-million;
• Licensing and other revenue of $235-million;
• Non-GAAP basic earnings per share of six cents and GAAP basic loss per share of two cents.

"This quarter we delivered sequential revenue growth in our cybersecurity business unit. Revenue growth was driven by a year-over-year increase in billings and pipeline, anchored on strength in our core verticals, particularly government," said John Chen, executive chair and chief executive officer, BlackBerry. "In our IoT business unit we saw some temporary delays to the start of new programs as a number of customers review their plans to capitalize on the software-defined vehicle (SDV) trend, impacting revenue this quarter. However, we see no change to the strong secular trends that are a multiyear tailwind for QNX and BlackBerry IVY. We continue to expect to achieve revenue consensus for both our IoT and cybersecurity business units this fiscal year."

First quarter fiscal 2024 financial highlights

• Total company revenue was $373-million;
• Total company GAAP and non-GAAP gross margin was 48 per cent, both lower due to completion of the significant sale of the non-core portion of the patent portfolio in the quarter. Excluding the patent sale, the non-GAAP gross margin was 22 percentage points higher;
• IoT revenue was $45-million, with gross margin of 80 per cent;
• Cybersecurity revenue was $93-million, with gross margin of 60 per cent and ARR (annual recurring revenue) of $289-million;
• Cybersecurity billings were $122-million, increasing for the fourth consecutive quarter, with 14-per-cent sequential and 37-per-cent year-over-year growth;
• Licensing and other revenue was $235-million, including $218-million relating to the patent sale;
• Non-GAAP operating profit was $35-million and GAAP operating loss was $11-million;
• Total cash, cash equivalents, short-term and long-term investments increased by $91-million to $578-million, with the first instalment of $170-million received from the patent sale;
• Net cash generated from operating activities in the quarter was $99-million.

Business highlights and strategic announcements

• BlackBerry completes patent sale transaction of substantially all of its non-core patents and patent applications to Malikie Innovations Limited, a wholly owned subsidiary of Key Patent Innovations Ltd.;
• BlackBerry QNX releases ultra-scalable, high-performance, compute-ready operating system to advance software development efforts for next generation vehicles and IoT systems;
• BlackBerry QNX software is now embedded in over 235 million vehicles worldwide: a year-over-year net increase of 20 million vehicles;
• Upstream Security joins the BlackBerry IVY partner ecosystem, leveraging IVY's rich telemetry data and edge compute capabilities to protect software-defined vehicles from cyber threats;
• BlackBerry launches enhanced artificial intelligence-based Cylance cybersecurity solutions portfolio, reducing alert fatigue, offering faster incident response and expanding cloud defense coverage;
• BlackBerry introduces integration of CylanceGUARD managed detection and response (MDR) and BlackBerry AtHoc critical event management (CEM) technologies for secure bidirectional response communications during cyber incidents;
• BlackBerry extends partnership with leading managed security services provider (MSSP), Solutions Granted, enabling better scale to address small and medium-sized businesses (SMBs);
• McKinsey names BlackBerry a cybersecurity and IoT convergence leader, well positioned in an addressable market of up to $750-billion by 2030.

Outlook

BlackBerry will discuss its outlook in connection with the quarterly earnings announcement on its earnings conference call.

Conference call and webcast

A conference call and live webcast will be held today beginning at 5:30 p.m. ET, which can be accessed through the company's investor website or by dialling toll-free 1-844-512-2926 and entering elite entry No. 6312676.

A replay of the conference call will be available at approximately 8:30 p.m. ET on June 28, 2023, on the same website or by dialling Canada toll-free 1-855-669-9658 or U.S. toll-free 1-877-344-7529 and entering replay access code 6786029.

About BlackBerry Ltd.

BlackBerry provides intelligent security software and services to enterprises and governments around the world. The company secures more than 500 million end points, including over 235 million vehicles. Based in Waterloo, Ont., the company leverages AI (artificial intelligence) and machine learning to deliver innovative solutions in the areas of cybersecurity, safety and data privacy solutions and is a leader in the areas of end point security, end point management, encryption and embedded systems. BlackBerry's vision is clear -- to secure a connected future you can trust.

We seek Safe Harbor.