BlackBerry (BB) last night reported Q1 FY2026 results that marked a significant milestone, as the company returned to GAAP profitability for the first time since Q4 FY2022, posting a net income of $1.9 million. The company's total revenue reached $121.7 million, surpassing guidance expectations, despite showing a slight decline from the previous year's $123.4 million. BlackBerry’s QNX division delivered particularly strong growth, increasing by 8% year-over-year to $57.5 million, while Secure Communications generated revenue of $59.5 million.
BB stock is up more than 11% in premarket trading this morning, on pace to open at 3-month highs. The stock is gapping away from recent support at its rising 20-day moving average ahead of the bell, and is looking to break away from resistance in the $4.50 area.
Inside BlackBerry’s Q1 Results
The company's strategic focus on cybersecurity and embedded systems continues to yield positive results, with the QNX segment showing particular strength in both automotive and non-automotive verticals. This is evidenced by the impressive 55% growth in the SDP8.0 pipeline during the quarter, and BlackBerry's efforts to expand QNX beyond automotive into industrial automation and medical devices.
BlackBerry maintains a strong financial position with $381.9 million in cash and investments, and has initiated a $100 million share buyback program, of which $10 million was executed in Q1.
Management's decision to raise full-year revenue guidance to $508-538 million reflects growing optimism about the company's trajectory, particularly in the cybersecurity space. The secure communications segment's forecast was notably increased to $234-244 million from $230-240 million, driven by robust demand for cybersecurity services amid rising online crimes. BlackBerry's gross margin expanded to 74%, while its Secure Communications division maintained a stable annual recurring revenue (ARR) of $209 million.
What’s Next for BB Stock?
Looking ahead, BlackBerry's transformation continues as it distances itself from its historical operations, focusing instead on emerging technology verticals and cybersecurity solutions. The company expects to generate approximately $35 million in operating cash flow for fiscal 2026, though some near-term caution exists regarding potential auto production impacts from recent tariff changes.
On Wall Street, BB stock has a consensus rating of “Hold” from the 5 analysts in coverage, and the shares are set to open north of their average 12-month price target of $4.43.
This article was generated with the support of AI and reviewed by an editor. On the date of publication, the editor did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
/AI%20(artificial%20intelligence)/Data%20Center%20by%20Caureem%20via%20Shutterstock%20(2).jpg)
/PayPal%20Holdings%20Inc%20HQ%20photo-by%20bennymarty%20via%20iStock.jpg)
/Micron%20Technology%20Inc_%20logo%20on%20building-by%20vzphotos%20vis%20iStock.jpg)
