BlackBerry Revenue Rose 26%. Q3 Guidance Is Lower

BlackBerry’s revenue rose 26% to $163.3 million in Q2 FY2027, the three months ended 31 August 2026. Almost half the increase came from a business the company expects to return to a much lower revenue level next quarter.

That business was Licensing. It brought in $22.1 million, against $6.6 million a year earlier, helped by a new intellectual property licensing arrangement. QNX, the embedded-software business, also had a record quarter. Both developments were real. They tell different stories about what can carry into the next quarter.

The useful question is not whether BlackBerry grew. It is how much of the growth came from each business — and what management expects those businesses to do next.

What drove BlackBerry’s 26% revenue growth?

QNX added $17.2 million, Licensing $15.5 million and Secure Communications $1.0 million. The 10-Q’s segment table reconciles those three parts to the $33.7 million increase. Amounts below are in US$ millions, for the three months ended 31 August in each year.

Licensing accounted for 46.0% of the increase: $15.5 million divided by $33.7 million. QNX supplied $17.2 million, while Secure Communications added $1.0 million.

Combining QNX and Secure Communications gives $141.2 million this quarter, against $123.0 million a year earlier. That is 14.8% growth. It is a comparison of the two businesses, not a company-defined adjusted revenue measure.

The licensing transaction therefore amplified an improvement already present elsewhere. Removing it from the story altogether would be as misleading as assuming the whole company now grows at 26% every quarter.

Will Licensing repeat its $22.1 million quarter?

Management guides Licensing to about $6 million in each of Q3 and Q4. That is the baseline in the filing, not a promise that larger deals cannot recur.

QNX revenue rose 27.3%, from $63.1 million to $80.3 million. The 10-Q attributes the increase principally to royalties, development licences and professional services. Royalty revenue alone contributed $10.4 million of the increase.

Management had guided QNX revenue to $70–75 million. The actual result exceeded that range, and the company now expects $82–88 million in the third quarter. QNX’s next-quarter range sits above the record it just reported.

Licensing has a different pattern. BlackBerry had expected about $10 million in the second quarter; the new intellectual property arrangement helped take the result to $22.1 million. The 10-Q explains that the timing and amount of larger transactions can vary between quarters.

Its guidance for both Q3 and Q4 is approximately $6 million of Licensing revenue per quarter.

This is recognised revenue from a real business. The filing does not label the entire segment a one-time gain, and future licensing transactions remain possible. What it does provide is a reason to avoid using this quarter’s amount as a recurring quarterly baseline.

Which businesses received an annual guidance upgrade?

BlackBerry raised its full-year revenue outlook. Looking at the segment ranges shows what changed inside it.

The midpoint changes reconcile: $16.5m − $10.0m + $12.0m = $18.5m. Midpoints are our arithmetic, not additional company guidance.

QNX improved enough, together with Licensing, to offset the reduction in Secure Communications. The 10-Q ties the lower Secure Communications outlook to greater caution around certain government opportunities in the second half.

The company-wide upgrade does not mean every business received an upgrade. That matters when deciding which part of the next earnings report to compare with this one.

Why is Q3 revenue guidance below Q2?

Q3 total revenue guidance is $143–154 million, below Q2’s $163.3 million. Its midpoint, $148.5 million, is 9.1% lower than the quarter just reported. That is a sequential comparison, not a forecast of year-on-year decline.

The segment ranges help explain it: QNX moves to $82–88 million; Secure Communications to $55–60 million; Licensing to about $6 million.

For scale, holding QNX and Secure Communications at their Q2 amounts and replacing Licensing with the Q3 guide gives $147.2 million: $80.3m + $60.9m + $6m. This is an illustration, not a forecast. It shows how the licensing change alone can pull down the total even before either other business changes.

The distinction resembles the one in Kroger’s earnings-per-share bridge: the headline is accurate, but understanding it requires identifying the component that moved.

Profit and cash improved too — keep the measures separate

The earnings release reports $33.9 million of GAAP net income and $29.3 million of operating cash flow. Licensing generated $20.0 million of adjusted EBITDA on $22.1 million of revenue — a 90.5% adjusted EBITDA margin.

That high margin helps explain why a large Licensing quarter can matter well beyond sales. It does not establish how much operating cash flow came from the new agreement: the disclosures used here do not isolate its cash collections.

Adjusted EBITDA is not net income or cash flow. The distinction is especially useful when a low-cost licensing transaction expands a profit measure, just as CoreWeave’s EBITDA, depreciation and interest show why a profit subtotal needs its own context. For cash definitions, Amazon’s three free-cash-flow measures provide a separate comparison.

What should investors check in Q3?

The next report has two different benchmarks. QNX should be compared with its $82–88 million revenue guide. Licensing should be compared with about $6 million, rather than with an assumption that $22.1 million repeats.

The limitation is straightforward: licensing deals can land unevenly, QNX royalties depend on customer activity, and guidance can change. This bridge separates reported growth and stated expectations; it does not value the stock or predict its return.

BlackBerry’s strong quarter contained both a growing QNX business and a large licensing transaction. The next total can be lower while the first story continues. The segment table will show which story actually did.

Check it yourself

Read the 10-Q’s revenue-by-segment table and outlook discussion, then compare them with the 24 September earnings release. All financial figures above are in US dollars. The Licensing contribution is calculated as (22.1 − 6.6) ÷ (163.3 − 129.6); the annual bridge uses the midpoint of each published guidance range.