BlackBerry Lifts FY27 Revenue Guidance to $636M High as EBITDA Margin Hits 29%

For investors, BlackBerry's Q2 FY2027 report is about profitable growth and capital efficiency. Revenue of $163.3 million grew 26% year over year while adjusted EBITDA expanded 81% to $47.0 million, pushing margins to 29% of revenue. Management's decision to raise the full-year revenue midpoint by $9 million signals confidence that QNX momentum and a new licensing deal can overcome Secure Communications' flat growth.

BlackBerry reported fiscal second-quarter 2027 results on September 24, 2026, with total revenue of $163.3 million, up 26% year over year. The quarter was anchored by record performance in QNX, which produced $80.3 million in revenue, a 27% increase from the prior-year period. Secure Communications contributed $60.9 million, up only 2%, while Licensing revenue of $22.1 million exceeded management expectations because of a new licensing arrangement signed during the quarter. Adjusted EBITDA reached $47.0 million, representing 29% of revenue and an 81% jump year over year. Adjusted gross margin improved three percentage points to 78.2%, reflecting a favorable mix shift toward higher-margin QNX and licensing revenue.

“

Revenue of $163.3 million grew 26% year over year while adjusted EBITDA expanded 81% to $47.0 million, pushing margins to 29% of revenue.

The results sharpen the picture of BlackBerry's transformation from a hardware company to a software and embedded systems business. QNX, the real-time operating system used across automotive, robotics, and medical devices, is now the company's most important growth engine. The disclosure of an Alloy Core design win valued at an estimated $100 million in future royalties is significant. Management called it the largest design win in the history of the QNX business. Equally important, Alloy Core carries an average selling price roughly three times higher than current deployments of the traditional QNX operating system. This suggests the new architecture is being positioned as a higher-value software layer rather than a like-for-like replacement.

Secure Communications remains the more defensive part of the portfolio. Annual recurring revenue grew 4% to $221 million, and the dollar-based net retention rate held at 91%. That retention figure is meaningful for investors because it means existing customers are, on average, spending less than they did previously. Renewals across government and critical infrastructure sectors stayed stable, but the sub-100% retention rate indicates contraction or downgrades in some accounts. For a business built on predictable recurring revenue, this creates a growth challenge: the customer base is sticky and compliance-driven, but it is not naturally expanding without new logos or meaningful price increases.

Cash generation improved dramatically in the quarter. Operating cash flow rose to $29.3 million from just $3.4 million in the prior-year period. Cash and investments totaled $447.1 million, including approximately $247.0 million in net cash. Management framed this as providing strategic flexibility for capital allocation, whether through acquisitions, buybacks, debt reduction, or continued investment in QNX and cybersecurity.

BlackBerry also raised its full-year revenue guidance to a range of $616 million to $636 million, an increase of $9 million at the midpoint. Full-year adjusted EBITDA guidance was set at $141 million to $158 million, implying 43% year-over-year growth at the midpoint. The guidance increase is notable because it comes despite Secure Communications growing only 2%. It effectively signals that management expects QNX momentum and licensing upside to carry the business through the second half of the fiscal year. The robotics and medical device category, referred to as JEM, already represents approximately 20% of total QNX revenue, providing diversification beyond automotive.