Latest news with #QNX
Yahoo
2 days ago
- Business
- Yahoo
Should You Hold or Sell BlackBerry Stock Before Q1 Earnings Release?
BlackBerry Limited BB is set to report first-quarter fiscal 2026 results on June 24. The Zacks Consensus Estimate is pegged at breakeven and has remained unchanged in the past 60 days. In the prior-year quarter, the company reported a loss of 3 cents per share. BB expects fiscal first-quarter 2026 revenues to be in the $107-$115 million range. The company has an impressive earnings surprise history. Its earnings outpaced the Zacks Consensus Estimate in each of the trailing four quarters, the average beat being 93.75%. Image Source: Zacks Investment Research Our proven model does not conclusively predict an earnings beat for BlackBerry this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But, that is not the case here. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter. BB has an Earnings ESP of 0.00% and a Zacks Rank #3 at present. You can see the complete list of today's Zacks #1 Rank stocks here. BB's performance is expected to have benefited from strength in the QNX segment (former IoT division), particularly solid demand for its solutions across the advanced driver assistance systems market and digital cockpit domains. Increasing traction for its next-generation version of QNX operating system SDP 8.0 (across automotive, rail medical, industrial and robotic verticals) as well as the QNX Cabin (digital cockpit development) solution augurs well. Earlier in the year, QNX and Microsoft MSFT partnered to aid automakers in building, validating and refining software within the cloud to power the evolution of SDVs. The partnership will bring the QNX Software Development Platform 8.0 to Microsoft Azure, offering automakers a comprehensive cloud-based environment to accelerate innovation while reducing development risks. Also, QNX and Microsoft plan to extend their collaboration to include the QNX Hypervisor and the QNX Cabin. Healthy revenues from royalties and development seat licenses are likely to have acted as tailwinds. BB's focus on go-to-market penetration, especially in adjacent automotive verticals, bodes well. Earlier in the year, BB launched its QNX General Embedded Development Platform to speed up time to market for scalable and secure embedded systems. The Secure Communications division's performance is likely to have been driven by healthy uptake of the SecuSmart, UEM endpoint management and AtHoc critical event management solutions. The sale of Cylance and extensive cost restructuring are aiding the performance of this particular division. BlackBerry Limited price-eps-surprise | BlackBerry Limited Quote In February 2025, BlackBerry sold its Cylance endpoint security assets to Arctic Wolf. BB has successfully achieved its initial target of cutting back roughly $150 million from its run rate. For the quarter to be reported, the company expects adjusted EBITDA to be between breakeven and $7 million. For the Secure Communications unit, BlackBerry expects revenues to be in the band of $50-$54 million. Licensing & Other revenues are expected to be roughly $6 million. For the QNX business, revenues are expected to be in the range of $51-$55 million. Affected by a volatile automotive backdrop, the company anticipates a sequential drop in QNX revenues from $65.8 million. In the last earnings call, management highlighted that due to recent tariff changes, especially on automotive goods, BlackBerry is currently unsure how this will affect its business. While BB does not expect a direct impact on its products and services, there may be indirect effects like supply-chain disruptions and changes in demand. BlackBerry is taking a cautious stance on the Secure Communications division due to ongoing turmoil in its core government markets. The potential impact of DOGE and other shifts within the U.S. administration, as well as political changes in Canada, Germany and other regions, are likely to create a challenging and unstable environment. While significant effects are yet to be seen, the situation remains unpredictable. These developments could lead to short-term disruptions for the business. BlackBerry also faces increasing competitive pressure in both IoT and cybersecurity businesses. BB's shares have gained 14% in the past six months, significantly outpacing the Internet Software industry's growth of 9.3%. The broader Zacks Computer & Technology sector and the S&P 500 composite have registered declines of 1.4% and 0.3%, respectively. Image Source: Zacks Investment Research Blackberry has underperformed its peers (within the cybersecurity space), such as CrowdStrike Holdings, Inc. CRWD. It has registered higher gains than Fortinet FTNT. Fortinet has gained 4.6%, while CrowdStrike is up 34.3% over the same time frame. BB stock is trading at a discount, with a 12-month price/book multiple of 3.58X compared with the Internet Software industry's 6.38X. Image Source: Zacks Investment Research Fortinet and CrowdStrike are trading at a 12-month price/book multiple of 39.28X and 34.64X, respectively, compared with the Security industry's multiple of 24.46X. Despite near-term headwinds and geo-political uncertainties, BlackBerry's strong execution on cost cuts, strategic divestitures, and continued QNX momentum support a stable outlook. The company's impressive earnings surprise history and improving fundamentals make a compelling case. For now, holding BB stock remains the most prudent strategy, allowing investors to benefit from its growth prospects while navigating external risks. New investors could wait for a more favorable entry point. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Microsoft Corporation (MSFT) : Free Stock Analysis Report Fortinet, Inc. (FTNT) : Free Stock Analysis Report BlackBerry Limited (BB) : Free Stock Analysis Report CrowdStrike (CRWD) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Sign in to access your portfolio
Yahoo
2 days ago
- Automotive
- Yahoo
Can Momentum in QNX Unit Fuel BlackBerry's Top-Line Growth?
BlackBerry Limited's BB QNX business, formed by rebranding its IoT unit, is benefiting from strength in the automotive segment, particularly strong demand for its solutions across the advanced driver assistance systems market and digital cockpit domain. Continued design win momentum is anticipated to further strengthen the QNX royalty backlog. The increasing adoption of the next-generation version of the QNX operating system, Software Development Platform (SDP) 8.0 (across aerospace, medical equipment, rail and defence verticals), as well as the release of the QNX General Embedded Development Platform, are aiding it. It supports modern platforms (ARMv9, RISC-V, multicore CPUs) and development tools and includes QNX Hypervisor 2.2 for mixed-criticality virtualization. Recently, BlackBerry's QNX announced that its SDP 8.0 will serve as the base OS for the Eclipse Foundation's Safe Open Vehicle Core (S-CORE) Project, supporting faster, cost-effective development of Software Defined Vehicles and marking a key step toward a common, safety-critical automotive platform. In May 2025, BlackBerry's QNX unit launched QNX Hypervisor 8.0, a virtualization tool built on SDP 8.0 to simplify complex embedded software development. It enables multiple OSes—like Android, Linux and QNX—to run securely on a single SoC via a microkernel architecture, offering virtualized memory, CPUs, devices and system isolation. Growing momentum in QNX Cabin with multi-year deal wins from the top 10 global auto OEMs further cushions its prospects. Despite delays in automotive software development, QNX's royalty backlog grew year over year to about $865 million. This shows that QNX is adding future royalty revenue faster than it is being recognized, which BlackBerry sees as a strong sign of the business's long-term health. QNX is a leading brand in the automotive sector, and BlackBerry is increasingly leveraging its strength as a key driver for top-line growth for fiscal 2026 and beyond. For the QNX business, revenues are expected to be in the range of $51-$55 million in the first quarter of fiscal 2026. However, the company anticipates a sequential fall in the revenues from the QNX business, which totaled $65.8 million during the fourth quarter of fiscal 2025. Volatility in the automotive sector remains concerning. Management, on the last earnings call, highlighted that due to recent tariff changes, especially on automotive goods, BlackBerry is currently unsure how this will affect its business. While it does not expect a direct impact on products and services, there may be indirect effects on its customers, such as supply chain disruptions and changes in demand. Alphabet Inc.'s GOOG Android Automotive OS (AAOS), launched in 2017, is a full-stack OS running directly on vehicle hardware, with services like Google Maps, Assistant and Play Store. It powers vehicles from Volvo, GM, Ford, Renault-Nissan, Stellantis, BMW and others. BMW adopted AAOS for OS8, and Ford plans to shift over half its fleet to it. According to S&P Global's report, AAOS will reach approximately 18% market share by 2027, while QNX falls to around 5%. Though AAOS lacks real-time and safety certifications, it excels in infotainment and app integration, often requiring a separate RTOS for critical systems. Wind River, owned by Aptiv PLC APTV, offers VxWorks (a real-time OS), Wind River Linux and Wind River Studio (cloud-based development/IoT platform). VxWorks is a mature RTOS certified for ISO 26262 ASIL-D, widely used in avionics and some automotive domains (particularly ADAS and autonomous platforms). Wind River has collaborated with Elektrobit to demo a software-defined vehicle controller. It's among the few RTOSes supporting OCI containers for edge deployments. While its automotive market share is smaller than BlackBerry QNX's, it's widely deployed in mission-critical systems. Wind River partners with AWS, NXP, Intel and Tier-1 suppliers, focusing on software-defined vehicles and IoT. Recent efforts include deeper integration with Elektrobit and AWS to advance autonomous vehicle development and edge-to-cloud solutions. Shares of BB have gained 87.8% in the past year compared with the Zacks Internet – Software industry's growth of 37.3%. Image Source: Zacks Investment Research From a valuation standpoint, BB trades at a forward price-to-sales of 4.79X, lower than the industry's average of 5.67X. Image Source: Zacks Investment Research BB currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Alphabet Inc. (GOOG) : Free Stock Analysis Report BlackBerry Limited (BB) : Free Stock Analysis Report Aptiv PLC (APTV) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
4 days ago
- Automotive
- Yahoo
QNX named foundational OS for Eclipse S-CORE project
QNX, a division of BlackBerry, has announced that its Software Development Platform (SDP) 8.0 will serve as the foundational operating system for the Eclipse Foundation's Safe Open Vehicle Core (S-CORE) Project. This collaboration aims to expedite the development timelines for automaker Software Defined Vehicle (SDV) projects and reduce the costs associated with moving from research to production. The S-CORE project represents a significant step forward in establishing a common, open, and safety-critical software platform for the automotive industry. It is an open-source initiative under the Eclipse Software Defined Vehicle (SDV) Working Group, which includes industry leaders such as BMW Group, Mercedes-Benz, ETAS, Qorix, and Accenture. Together, they are developing an open-source core stack for SDVs, focusing on embedded high-performance Electronic Control Units (ECUs). The initial release of S-CORE (v0.5) is set to provide essential functionalities like application orchestration, inter-process communication (IPC), and logging & persistency. To support these features, QNX SDP 8.0 has been chosen as the operating system for the initial reference platform. This integration is part of the QNX Everywhere initiative, which offers expanded access to QNX's high-performance foundational software for non-commercial purposes, benefiting students, educational institutions, research organizations, and OEMs for early prototyping. The QNX Everywhere initiative grants free access to QNX SDP 8.0 for non-commercial use, along with complimentary resources and on-demand training. This initiative is designed to facilitate learning, experimentation, and innovation in embedded systems. By leveraging the reliability of operating systems like QNX alongside the adaptability of open-source development, the S-CORE project enables contributors and adopters to innovate more rapidly and efficiently, from the proof-of-concept stage all the way through to production. QNX COO and head of Products, Engineering and Services John Wall said: "Embracing our role as the foundational operating system for the Eclipse S-CORE Project is a testament to QNX's trusted reputation within the automotive industry. This milestone benefits OEMs by enabling easy and simple access to QNX 8 software for non-commercial use for advanced prototyping to accelerate development cycles. "By enabling Eclipse S-CORE and with support from a who's who of major automakers and Tier 1s, we're thrilled to provide more non-commercial developers with free access to QNX SDP 8.0, enabling them to build the future of automotive technology with confidence and efficiency." "QNX named foundational OS for Eclipse S-CORE project" was originally created and published by Just Auto, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
09-06-2025
- Automotive
- Yahoo
BlackBerry Stock Surges 47% in Six Months: Time to Hold or Fold?
BlackBerry Limited's BB shares have rallied 46.5% in the past six months, outperforming the Internet Software industry's growth of 7.8% and the S&P 500 composite's decline of 0.9%, thereby attracting investors' interest. BB stock inched up 1.5% and closed the session at $4.13, still down 33.8% from its recent 52-week high of $6.24. Image Source: Zacks Investment Research Once known for smartphones, BB has made a pivot to cybersecurity and Internet of Things (IoT), focusing on enterprise security, embedded software and auto technology. BlackBerry has also outperformed peers within the cybersecurity space, such as Fortinet FTNT and CrowdStrike Holdings, Inc. CRWD. Fortinet and CrowdStrike have gained 8.1% and 35.1%, respectively, over the same time frame. FTNT is a provider of network security appliances and Unified Threat Management network security solutions, while CRWD is a leader in next-generation endpoint protection, threat intelligence and cyberattack response services. Now, the question arises: Does BB's rally still have room to run, or was the surge a temporary pop driven by speculation? Let's explore the catalysts behind the surge, the fundamentals, and whether you should hold on or fold. The renamed QNX division (formerly IoT unit) is being positioned as the strategic core going forward. BlackBerry's QNX business is gaining from strength in the automotive segment, particularly strong demand for its solutions across the advanced driver assistance systems market and digital cockpit domain. The rapid adoption of the QNX platform in the General Embedded markets is a positive factor. The increasing adoption of the next-generation version of the QNX operating system, SDP 8.0, in the Auto and General Embedded market and the release of the QNX General Embedded Development Platform are positive factors. Earlier in the year, QNX and Microsoft MSFT partnered to aid automakers in building, validating and refining software within the cloud to power the evolution of SDVs. The partnership will bring the QNX Software Development Platform 8.0 to Microsoft Azure, offering automakers a comprehensive cloud-based environment to accelerate innovation while reducing development risks. Also, QNX and Microsoft plan to extend their collaboration to include the QNX Hypervisor and the QNX Cabin. Growing momentum in QNX Cabin with multi-year deal wins from the top 10 global auto OEMs further cushions its prospects. Despite delays in automotive software development, QNX's royalty backlog grew year over year to about $865 million. This shows that QNX is adding future royalty revenues faster than it's being recognized, which BlackBerry sees as a strong sign of the business's long-term health. BlackBerry Limited price-consensus-eps-surprise-chart | BlackBerry Limited Quote BlackBerry has offloaded its underperforming Cylance unit to Arctic Wolf. The transaction with Arctic Wolf unlocked $80 million in initial cash proceeds and 5.5 million shares, while preserving BlackBerry's AI/ML patent assets and tax losses. BB expects these tax losses to provide a shield for future profits generated by its U.S. entities. Momentum in the Secure Communication division, driven by solid operational execution and cost-saving efforts, is working in favor of BlackBerry. Fiscal fourth-quarter revenues of $67.3 million beat the high limit of the company's forecast ($62-$66 million), driven by strong AtHoc revenues and renewals in the core German market. Healthy momentum in UEM stemmed from rising deal wins from government agencies, top banks and law firms. Expansion of the deal with the Malaysian government bolsters both the contract length and the number of licenses. The Malaysian government is a great example of successfully using its full Secure Communications portfolio, and it is working to replicate this model in other regions. Management highlights this division to be a key contributor to BlackBerry's overall EBITDA and cash flow. BlackBerry's total adjusted EBITDA for fiscal 2025 was $39.3 million, including Cylance. This is a $54 million improvement from last year after adjusting for the patent sale in early fiscal 2024. Cost-cutting and restructuring measures are driving up profitability for BlackBerry. It has successfully achieved its initial target of cutting back roughly $150 million from its run rate. Image Source: Zacks Investment Research Management expects an additional $75 million of cash to be added in fiscal 2026, including the second Cylance payment of $40 million, positioning the company to reinvest or return capital opportunistically. Due to recent tariff changes, especially on automotive goods, BlackBerry is currently unsure how this will affect its business. While it does not expect a direct impact on products and services, there may be indirect effects on its customers, such as supply chain disruptions and changes in demand. Given the current uncertainty, BlackBerry is maintaining the upper end of the revenue guidance ($260-$270 million) shared at Investor Day in October but widening the lower end. It now expects QNX revenues to fall within the range of $250 million to $270 million. BB's QNX backlog may look robust, but the realization of the same may be delayed owing to the ongoing weakness in global auto production, and with several OEMs facing supply chain disruptions and demand uncertainty. BlackBerry is also taking a cautious stance on the Secure Communications division due to ongoing turmoil in its core government markets. The potential impact of DOGE and other shifts within the U.S. administration, as well as political changes in Canada, Germany and other regions, is likely to create a challenging and unstable environment. While significant effects are yet to be seen, the situation remains unpredictable. These developments could lead to short-term disruptions for the business. BlackBerry faces increasing competitive pressures in both IoT and cybersecurity businesses. Given the factors, analysts remain cautious, as evidenced by unchanged estimates in the past 60 days. Image Source: Zacks Investment Research Though the company's strategic pivot toward high-margin areas, such as IoT and Secure Communications, augurs well, there are several risks that could put downward pressure on the stock price. Its heavy reliance on cost-cutting measures to drive EBITDA, exposure to volatile markets like automotive, and stiff competition in the cybersecurity space remain concerns. Though BB stock is trading at a discount with a trailing 12-month price/book multiple of 3.43 compared with the industry's multiple of 6.34, this could mean more risk than opportunity. Image Source: Zacks Investment Research Given these factors, investors should exercise caution and wait for a more favorable entry point. Investors holding BB stock should closely monitor how BlackBerry executes its strategic priorities in the coming quarters. BB currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Microsoft Corporation (MSFT) : Free Stock Analysis Report Fortinet, Inc. (FTNT) : Free Stock Analysis Report BlackBerry Limited (BB) : Free Stock Analysis Report CrowdStrike (CRWD) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Globe and Mail
28-05-2025
- Business
- Globe and Mail
Former smartphone titan BlackBerry is back, with a new CEO and autonomous driving tech at the wheel
As a kid, John Giamatteo had a single dream: to one day lead an NFL team to the Super Bowl, just like his underdog-turned-icon hero, Joe Namath. But by his sophomore year of high school, he knew it wasn't going to happen. He'd virtually stopped growing, ending up at 5-foot-9, and his coach dropped him from quarterback to defence. That's when his dad—a one-time phone repairman-turned-manager—gave his crestfallen son a pep talk. 'He pulled a pen out of his pocket and said, 'You're going to make a career with this pen. You're going to get an education, and you're going to have a professional career. That's going to be your journey,'' Giamatteo recalls more than 40 years later. That journey led him to begin his career at Nortel Networks in the 1980s. Now the native of Long Island, N.Y., has the first quarterback gig of his career, leading another notorious Canadian tech company: BlackBerry Ltd. Before we go any further, yes, BlackBerry is still a thing. If you haven't been paying attention (and you're not alone), the company that popularized the smartphone and built Waterloo, Ont., into a tech hub, gave up on handsets in 2016, and went all in on software and services. Through its QNX subsidiary, it's now a leading supplier to automakers of the sophisticated operating systems that underpin autonomous and advanced driver-assistance functions. If your car stops you from veering into oncoming traffic, you probably have BlackBerry to thank. It also sells secure communications software to governments, and critical infrastructure providers like ports and nuclear power plants. That's not to say the company formerly known as Research In Motion was in particularly good shape when Giamatteo became CEO in December 2023. Under his predecessor, John Chen—hired in November 2013 to be its saviour—revenue growth was tepid, and the company was bleeding cash. BlackBerry was a jumble of businesses, and the board was considering a spinout of QNX to revive the stock, which was languishing at under $4, about where it had been 20 years earlier. (All currency in U.S. dollars.) A year and a half later, BlackBerry is on its most stable footing since the iPhone and Android blew up its business in the late 2000s. Giamatteo and his team have slashed $150 million in annual costs, refinanced its debt, cut the headcount by 37%, shed more than a quarter of its real estate space and sold its once-promising cybersecurity business, Cylance, for a huge discount. BlackBerry has also narrowed its net loss to near break-even—though the bigger story is that adjusted operating earnings have soared, and it's generating cash again. The stock jumped in December on the Cylance news and soared above $6 early this year, though it's since given up its gains thanks to the economic uncertainty unleashed by Donald Trump. But company followers are happy with the rebirth in motion. 'The tough decisions that needed to be made have been made,' says Niall O'Keeffe, co-founder of Fifthdelta, a U.K. hedge fund manager that bought into BlackBerry in 2021. Giamatteo, he says, has put BlackBerry 'back on offence, where it's generating cash and can actually invest in the fast-growing areas.' Even EdgePoint Wealth Management—which invested in BlackBerry between 2008 and 2012, and later called that a mistake—has bought back in, amassing 12.2 million shares. With revenue of $535 million in its last fiscal year, the company now has greater control over its destiny than at its 2011 peak, when that topline number was $19.9 billion. It 'has completely turned the corner,' says BlackBerry's chair, Dick Lynch, who oversees a board that has largely turned over in the past couple of years. 'We know the businesses we're in, we know how to optimize those businesses, and we know what we need to do to grow them.' Giamatteo, Lynch adds, 'has been a very positive, transformative event.' But investors expect more. 'It's always going to be, 'What will you do next year?'' Giamatteo says. One part of that answer is: Deliver solid revenue growth at QNX. But it also means confronting a decision in the not-too-distant future that could cut much of BlackBerry's ties to Waterloo. 'Anything is on the table if it makes sense for shareholders.' Giamatteo is nothing like BlackBerry CEOs past. He's not mercurial and sharkish like Jim Balsillie or a technologically consumed genius like Mike Lazaridis. He certainly bears no resemblance to the soft-spoken Thorsten Heins, the towering German technocrat who briefly succeeded the company's longtime co-CEOs. And he's a dramatic departure—a welcome one, according to employees—from the aloof and imperious Chen. As CEO, Chen had his own car and driver (paid for by BlackBerry), flew by private jet for work (or, if a jet wasn't available, in first class—a stipulation in his contract), and travelled with an entourage that included a security detail and chief of staff. Giamatteo, meanwhile, is perfectly happy to fly coach on cross-country hops (he's based in Dallas but typically visits Canada at least once a quarter). His hotel of choice is distinctly middlebrow, too: Hilton's Homewood Suites or La Quinta. 'He's a kind of Bruce Springsteen of the executive world,' says chief people officer Jennifer Armstrong-Owen, who joined Giamatteo at BlackBerry after working with him at Seattle-based RealNetworks in the 2000s, one of several former co-workers who followed him on his Canadian adventure. 'He's the same person to the bellhop, to the waiter, as he is to a CEO.' With his slicked-back salt-and-pepper hair, fondness for business-casual attire and distinctive accent reminiscent of fellow Long Islander Billy Crystal, Giamatteo comes off as a congenial what-you-see-is-what-you-get everyman (one who says 'holy cow' a lot). He's not the visionary type. 'I'm more of the operational guy who's making the trains run on time,' he says. Chen was no visionary, either, but he was paid like one. When he was hired in 2013, fresh off his turnaround of database software vendor Sybase, Chen received stock awards worth more than $84 million, with a salary of $1 million and a guaranteed annual bonus of $2 million. When his contract was renewed in 2018, he got another $106.3 million worth of stock awards. Giamatteo, meanwhile, is paid $700,000 annually and can earn up to that amount in bonus, though it's not guaranteed. His stock award upon becoming CEO was worth just $6 million. 'I like to think of myself as a pretty simple person,' says Giamatteo, who has three adult daughters with his wife, Stephanie. 'I live a private life. I'm very family oriented. I generally don't get too involved in that kind of media stuff.' Indeed, it took a year to persuade him to sit down with Report on Business magazine for his first media interview as CEO. That might not be due solely to Giamatteo's modesty. In April 2024, four months after his appointment, a former executive sued both Giamatteo and BlackBerry for sexual harassment, discrimination and wrongful termination. By November, a California judge had tossed all complaints against him and many (but not all) claims against BlackBerry. 'I'm very pleased that all of the claims against me were dismissed with prejudice, which is a statement,' he says (this means the claims can't be refiled). 'I know who I am. I know my values that I was brought up with.' By his own account, Giamatteo had an 'extraordinarily happy' childhood in the largely middle-class hamlet of Bellmore, N.Y., on the south shore of Long Island, within walking distance of his extended family. When his two older siblings moved out, they stayed in Bellmore, too. 'It was definitely our family town,' he says. The Giamatteos were staunch Italian Catholics, and every weekend they piled into the station wagon and headed to church, where John was an altar boy. When he wasn't at mass or in school, he was usually outside playing street hockey, baseball and, of course, football. In 1986, during his second year of undergrad at St. John's University, a private Catholic school in Queens, Giamatteo had two life-altering experiences: He spent a term in Europe, which opened his eyes to the world beyond Bellmore; and he applied for a summer internship at Nortel, at his sister-in-law's suggestion. He spent the summer at Nortel's Wall Street office, and after graduating from St. John's, he returned as a financial analyst supporting regional sales teams. For Nortel, those were the glory days. AT&T had been busted up earlier that decade, and all those recently hatched 'Baby Bells' were upgrading their networks with digital switching and transmission technology. Giamatteo gained notice in the early 1990s after he internally championed a team member's suggestion that Nortel aggressively lowball its bid for a big switching contract. By foregoing margins on the deal, Nortel could win higher-margin sales of follow-on offerings once the equipment was installed. The gambit worked, and it influenced how Nortel bid on contracts elsewhere. Giamatteo joined Nortel's leadership development program, rotating through sales, customer support and product roles before landing a coveted international posting in 1999 in Asia, overseeing a sevenfold sales increase in Korea. After the telecom bubble burst in 2001, he was sent to Japan to rationalize the business and return it to profitability—which he did. By his late 30s, Giamatteo was president of Nortel Asia Pacific, with his eye on the CEO suite. It wasn't meant to be at Nortel, however. After an accounting scandal consumed the company, Giamatteo moved to Seattle in 2005, becoming chief operating officer of streaming pioneer RealNetworks, where he lasted five years before his young family got tired of the rain. In 2010, they uprooted for Dallas, where he became COO of an insurance software provider called Solera Global Technology. He was supposed to run the business while the CEO focused on the big picture, but things didn't go according to plan. 'Four months into the job,' he says, 'I realized the CEO didn't really want to let go.' From there, he moved to cybersecurity business AVG Technologies, again as COO, to help take it public. 'We needed someone who had the maturity, could build the systems to take things we were doing and grow it,' says Dale Fuller, then AVG's chair. 'John was an integral part of that. He had the natural skills to be a leader.' AVG went public, but the board passed over Giamatteo in favour of a higher-profile outsider as CEO. Disappointed, he hit the road again, landing in 2013 at cybersecurity giant McAfee as president and chief revenue officer of its consumer business. Private equity firm TPG bought control of McAfee in 2017 and signed senior leaders to three-year contracts. When those were up, Giamatteo was packaged out. At 53, he was well off, unemployed and unable to work for a rival for a year. As the pandemic took hold, he got fit, golfed and cooked, wondering whether to get back in the game. Then BlackBerry called looking for someone to run its cybersecurity division. Even though it wasn't for the top job, Giamatteo was keen, once his non-compete ended. He figured the CEO post would open up before long, since Chen was in his mid-60s. 'He'd been a bridesmaid for a long time,' says John Dimitropoulos, who worked with Giamatteo at Nortel, RealNetworks and McAfee, and is now BlackBerry's chief strategy officer. 'He said to me, 'I think this is the one.'' By the time Giamatteo joined BlackBerry in 2021, Chen's lustre was long gone. The veteran Silicon Valley turnaround artist had arrived eight years earlier, initially skeptical he could fix the floundering smartphone franchise but lured with that rich stock award. BlackBerry was in full-blown crisis. Its touchscreen phones, based on the new BlackBerry 10 operating system, were a flop. During Chen's first few months, BlackBerry shed thousands of employees, wrote down unsold phone inventory and sold off most of its real estate. That year, BlackBerry posted a $5.9-billion net loss. Chen was loath to let the phone business die on his watch, but after three years of further declines, he gave up. Fortunately, the business remained a significant source of cash. CrackBerry users who clung to their devices kept paying service fees that yielded $3.5 billion during Chen's tenure. And its server software, originally used by organizations to manage their BlackBerrys, and later other mobile devices, remained a viable, albeit declining, business known today as BlackBerry Unified Endpoint Management. Meanwhile, BlackBerry copied other fallen tech stars by shaking down companies it claimed were using its trove of intellectual property, suing if necessary to get them to pay for licences. Those efforts generated another $1.4 billion in revenue over the eight fiscal years ended Feb. 28, 2023. The company even won a $940-million arbitration award from chipmaker Qualcomm in 2017 after overpaying upfront royalties for phone sales that never materialized. While those revenues kept BlackBerry alive, it couldn't remain a corporate fungus feeding off decaying assets forever. Chen believed its traditional strength in cybersecurity was a solid foundation for expansion. In 2014 and 2015, BlackBerry paid a combined $765 million for three companies that today make up the core of its Secure Communications business: secure messaging company Secusmart; AtHoc, maker of a crisis communications platform for government agencies; and Good Technology, a rival device-management business. The stock had a decent run, and in spring 2018, BlackBerry reported its first annual net profit in six years. 'I would not call us in a turnaround mode anymore,' Chen told Bloomberg TV. 'Now we're really delivering.' Lead director Prem Watsa, who'd recruited Chen and was chair of the compensation, nomination and governance committee, negotiated a five-year contract extension for the CEO. Later that year, BlackBerry bought Cylance for $1.4 billion, its biggest acquisition ever. But BlackBerry's results remained choppy, and none of the acquired businesses seemed to blossom. Plus, the senior ranks were in constant flux: A former Boeing and Cisco executive joined as president in 2019 and left that same year. His replacement lasted just 17 months. Cylance founder Stuart McClure got $29 million in restricted equity to stick around after the acquisition because the board deemed his leadership critical. He bolted after just a few months, leaving behind his earn-out. Chen's autocratic, distant management style didn't help. 'He'd remind you in executive meetings that he was the decider,' says one BlackBerry insider. Few employees ever got the chance to meet him, since he worked from an office in San Ramon, Calif. (Chen didn't respond to an interview request.) Meanwhile, Chen's pay package generated unwelcome attention, which picked up after BlackBerry's stock price quadrupled and then retreated over a few days in January 2021. Retail investors, spurred by social media investment mavericks like WallStreetBets, were speculating wildly in shares of faded companies like GameStop, AMC and, yes, BlackBerry. The 'meme stock' moniker embarrassed the company's employees and perplexed regulators. 'No one had ever seen that sort of thing before,' says Lynch. 'It was a disruption to the evidence of what progress we were actually making.' CFO Tim Foote, who led investor relations at the time, had built BlackBerry's credibility with institutional investors, only to see many sell into the rally. 'And then they were all gone,' he says. 'By the time the tide goes out, you were back to square one.' Even worse, the meme-stock surge unlocked three million of Chen's restricted stock units that were meant to vest when they hit certain price thresholds—but from a fundamentals-driven share-price appreciation, not a bogus rally. Chen's windfall automatically triggered the sale of $24.8 million of his stock to cover his tax bill. That wasn't his fault, but the optics were terrible. At BlackBerry's annual meeting in June 2022, goaded by proxy advisers including Glass Lewis & Co., shareholders flunked the company in a non-binding say-on-pay vote. They also nearly voted out Watsa, whose Fairfax Financial is BlackBerry's largest investor. Watsa left the board in February 2024. Chen's final year at BlackBerry was grim. A $600-million sale of its legacy smartphone patents fell through when the buyer couldn't raise the necessary financing, and BlackBerry finally unloaded the portfolio in early 2023 for $200 million plus future royalties. That prolonged sale process suppressed licensing revenue, which diminished cash flow. So did weaker financial performance by its cybersecurity business. Cash and short-term investments dwindled, and BlackBerry faced a deadline to repay $365 million in debentures in late 2023 (which it partly financed by issuing higher-yielding notes after Giamatteo took over). The stock reached its lowest level in 20-plus years, down 40% from when Chen joined. There was little the board could do, however. Chen's contract contained a time bomb. If he was terminated—or even if the board reduced his authority, duties or responsibilities, or made a material change to strategy that he disagreed with—it would force the vesting of a $90-million cash payment. In its weakened state, BlackBerry couldn't afford to ditch him. 'It totally neutralized the board,' says another company insider. 'They were not able to make John do anything he didn't want to do. They were stuck with him' until his contract expired on Nov. 3, 2023. By that time, the board had a good idea who its next CEO would be. It had quietly initiated a process to select someone who understood the business and its complexities, and who would 'be credible in all aspects, to all audiences,' as Lynch puts it. Giamatteo, he says, 'had a following of people who thought he was really good at what he did.' The quarterback from Long Island was finally getting the callup—albeit to what looked like a last-place team. It was mid-October 2024, and analysts were gathered at the New York Stock Exchange for BlackBerry's first investor day of the Giamatteo era. The morning event kicked off with a video that started with one question on a big screen: 'Do you know what the company BlackBerry does today?' What followed were responses from random people on the streets of New York. 'Uhhh, I didn't know they still existed,' one man said. A young woman recoiled in disbelief that BlackBerry was even still alive. Moments later, Giamatteo emerged onstage. 'When people hear the name BlackBerry,' he told the crowd, 'quite often one question comes to mind: 'BlackBerry, are you still around?'' Over the next few hours, he and his team would highlight what they'd been up to over the past 10 months. Breaking the ice with a little humility signalled Giamatteo wasn't afraid to address the company's challenges and faded legacy. Giamatteo's down-to-earth leadership style has already lightened the mood inside BlackBerry. He readily mixes with employees and is 'not this iconic thing you're never going to talk to who stands on a pedestal. He's just in the group—no entourage, no security,' says QNX's COO, John Wall. 'It's a completely different style' than Chen's. Phil Kurtz, BlackBerry's chief legal officer, adds that when Giamatteo holds town halls, he feeds off employees' energy rather than just broadcasting remotely to the masses. 'He wants and accepts very candid feedback,' says Kurtz. 'It's easy to feel appreciated.' BlackBerry has undergone more than a culture shift. Giamatteo has remade how the company operates. And while it hasn't quite regained darling status among investors, hundreds of millions of people still use BlackBerry's products. The company's standout division is QNX, whose sophisticated operating system dominates the so-called software-defined vehicle (SDV) space even more than BlackBerry once did the handset market. Today, roughly one-fifth of cars built each year are software-defined, and QNX is in 90% of them. That's more than 255 million vehicles with QNX on board. And as automakers increasingly shift to building computers on wheels, QNX sits in pole position. When two ex-Citadel hedge fund managers set up Fifthdelta in 2021 to invest in industrial companies in the automotive space, everyone they surveyed talked up SDV. 'And what was consistent across every original equipment manufacturer, every car company, was QNX,' says O'Keeffe. When they started digging, he says, 'we got very excited.' Car makers were abandoning their own software-development efforts and choosing QNX. The product was cheap—automakers pay an average of about $10 per car—so those that chose QNX were unlikely to replace it. Within months, BlackBerry was Fifthdelta's top holding. QNX was founded in 1980, building the nucleus of powerful operating systems. Its tech was embedded in Cisco routers, nuclear power plants, air traffic control systems and credit card authorization systems. By the time BlackBerry bought the Ottawa-based company in 2010 for $200 million (it had been owned since 2004 by car stereo maker Harman International), it was also making digital infotainment systems for upscale cars. That's not what interested Lazaridis, however: He wanted QNX engineers to build BlackBerry's next mobile-device OS. BlackBerry 'couldn't have cared less' about QNX's automotive venture, says Kurtz, who worked on the deal. 'It paid its bills. No one did anything to kill it, but it wasn't given a ton of oxygen.' From 2010 to 2014, says Wall, who led QNX's car software group, 'nobody was paying attention to me.' Well, maybe no one inside BlackBerry. While its handset business disintegrated in Waterloo, Apple set up shop next to the QNX facility in Ottawa and began picking off dozens of its engineers to work on its autonomous electric vehicle project, Titan. The defectors included QNX founder Dan Dodge, a University of Waterloo prodigy who preached that software was the key to modern life. (Apple came after Wall, too, but he says he preferred working with customers to hatching internal projects.) Meanwhile, car makers were adopting Google's Android OS for their infotainment needs, and Wall was concerned his business would disappear, 'just like what happened to BlackBerry.' There was an off-ramp, however: Wall's group saw that it could develop other systems inside increasingly digitized vehicles. The group pivoted hard in the mid-2010s, developing advanced driver-assistance and safety systems, then broadened its offerings so customers could use its platform elsewhere in the car, too. QNX was conceding the infotainment war to conquer a much bigger opportunity. By the 2020s, big automakers were asking it to build a vehicle-wide foundational platform that would underpin the digital cockpit, as well as the instrument clusters, surround-view sensor systems—and even support infotainment applications. The ploy worked. In fiscal 2025 (ended Feb. 28), QNX generated revenue of $236 million, up from $130 million in 2021. The long-term fundamentals remain sound, despite some automaker delays and industry uncertainty due to Trump's tariff war. BlackBerry is also exploring further uses for QNX tech in the medical, industrial and rail sectors. As Giamatteo became CEO in late 2023, BlackBerry abandoned a plan to take QNX public but retain majority control. Investors weren't keen on it, says Giamatteo, and he didn't think it was the solution to creating near-term value. Instead, he zeroed in on BlackBerry's cybersecurity division, where he'd spent two years as president. During that time, Giamatteo overhauled its go-to-market sales and marketing strategy, and consolidated its bloated R&D group. With the entire company under his charge, he established QNX and cyber as two standalone units, and focused on stopping the rapid decline in BlackBerry's cash reserves, in part by eliminating roles in finance, legal, HR and IT. As Giamatteo and his team dug deeper, they isolated the cybersecurity unit's biggest problem: Cylance. It had come to market with anti-virus software driven by artificial intelligence that protected devices from the cloud. Revenues grew robustly, reaching $151 million the first full year BlackBerry owned it. But as people worked remotely in the pandemic, making networked devices more vulnerable to attacks, market demand shifted toward products that provided detection, response and remediation—known as EDR—capabilities. While Cylance tried to stop malware invasions, EDR also fought the problem from inside, like battling a rodent infestation. Big companies embraced EDR, and demand for Cylance from Fortune 500 companies withered. Cylance shifted to serving smaller companies, but sales kept declining. It tried to catch up by building its own EDR offerings but that was expensive, and larger competitors vastly outspent it on marketing. By last October's investor day, Cylance was on track to generate $90 million in revenue and lose more than $50 million that fiscal year. BlackBerry couldn't afford to keep that up, Giamatteo told analysts. Another revelation: Cylance's losses obscured a decent bottom-line performance from the rest of the cyber unit. With Cylance, it was barely breaking even. Without Cylance, it was a cash cow, generating $52.3 million in operating profits last year. The management team decided Cylance was 'probably a better asset outside the company,' says Giamatteo. In late 2024, BlackBerry announced it was selling Cylance to U.S.-based Arctic Wolf Networks, paying $144.6 million, barely 10% of what BlackBerry had shelled out for it. Nonetheless, analysts were pleasantly surprised—it was like found money for an asset they'd deemed worthless. The cyber unit (since rebranded as Secure Communications) now has a narrower customer set of governments and critical infrastructure providers, which has focused its sales and marketing efforts, according to Jean Treadwell, the group's marketing VP, and another recruit who worked with Giamatteo at Nortel and McAfee. But the rest of Secure Communications will probably find itself following Cylance out the door eventually. The unit might now have a better financial profile, but O'Keeffe says it remains a hodgepodge of a business that's far less exciting than its corporate sibling. 'Selling is the outcome we'd like to get to eventually,' says O'Keeffe. It's not hard to see why. QNX has a strong long-term growth story. Secure Communications doesn't, and it's dragging down BlackBerry's valuation. Though the units are roughly the same size, QNX is worth far more. CIBC analyst Todd Coupland values it at seven times estimated fiscal 2027 sales and 30 times forecast operating earnings. He pegs the cyber unit's value at three times 2027 sales and 12 times earnings. That makes QNX worth between $2.25 and $5.01 per share, compared to just $0.39 to $1.95 for Secure Communications. BlackBerry has plenty of options. Secure Communications is profitable, resilient and has great customers in a solid market—the ideal profile for a private equity takeout. BlackBerry could sell it and invest the proceeds in QNX, acquire another company, buy back shares or retire its $200-million debt. Or it could hang on and try to squeeze out some growth—though opportunities are limited. Its best hope is Secusmart, whose SecuSuite secure messaging platform features tight protocols and locked-down features that make it a strong alternative to Signal for sensitive government communications—a fact BlackBerry has promoted around Washington, D.C., in the wake of the Signalgate scandal. Or BlackBerry could wait out the current market volatility and keep banking cash from Secure Communications. 'Those are the big questions getting asked' by the company's leadership, says Dimitropoulos. 'Which of those gives the greatest shareholder value and the best return? And if there's a market slowdown, is cash king—or is cash flow king? Is having a big balance sheet the right thing to do in a downturn, or making a bunch of cash flow so you can fund your business through the downturn that might be ahead?' Of course, selling Secure Communications would greatly shrink BlackBerry's presence in Waterloo, and it's a good bet the remaining company would take a new name (probably QNX). Giamatteo doesn't seem particularly sentimental about the prospect. For now, he says, selling is not part of the plan. 'But if we felt the best outcome for shareholders was to divest the business, I don't think we'd hesitate.' But let's give the guy a minute. He's barely arrived, and he's already done what his predecessors failed to do: stop the bleeding and give BlackBerry options. When your biggest problem is figuring out what to do with your growing pile of cash, that's a good start. Your time is valuable. Have the Top Business Headlines newsletter conveniently delivered to your inbox in the morning or evening. Sign up today.
