BlackBerry Limited

Good afternoon and welcome to the BlackBerry first quarter fiscal year 2026 results conference call. My name is Julian and I will be your conference moderator for today's call. During the presentation, all participants will be in a listen only mode. We will be facilitating a brief question and answer session towards the end of the conference. Should you need assistance during the call, please signal a conference specialist by pressing star zero. As a reminder, this conference is being recorded for replay purposes. I would now like to turn the call over to Martha Gonder, Director of Investor Relations with BlackBerry. Thank you. You may begin.

Thank you, Julian. Good afternoon, everyone, and welcome to BlackBerry's first quarter fiscal year 2026 earnings conference call. Joining me on today's call is BlackBerry's Chief Executive Officer, John Giammatteo, and Chief Financial Officer, Tim Foote. After I read our cautionary note regarding forward-looking statements, John will provide a business update and Tim will review the financial results. We will then open the call for a brief Q&A session. This call is available to the general public via call-in numbers and via webcast in the investor information section at blackberry.com. A replay will also be available on the blackberry.com website. Some of the statements we'll be making today constitute forward-looking statements and are made pursuant to the safe harbor provisions of applicable U.S., Canadian securities laws. We'll indicate forward-looking statements by using words such as expect, will, should, model, intend, believe, and similar expressions. Forward-looking statements are based on estimates and assumptions made by the company in light of its experience and its perception of historical trends, current conditions, and expected future developments, as well as other factors that the company believes are relevant. Many factors could cause the company's actual results or performance to differ materially from those expressed or implied by the forward-looking statements. These factors include the risk factors that are discussed in the company's annual filings and MD&A. You should not place undue reliance on the company's forward-looking statements. Any forward-looking statements are made only as of today, and the company has no intention and undertakes no obligation to update or revise any of them, except as required by law. As is customary during the call, John and Tim will reference non-GAAP numbers in their summary of our quarterly results. For a reconciliation between our GAAP and non-GAAP numbers, please see the earnings press release published earlier today, which is available on Anchor, Cedar Plus, and BlackBerry.com websites. And with that, let me now turn the call over to John.

Thanks, Martha, and thanks to everyone for joining today's call. We made a very solid start to fiscal year 2026 with our results beating the top end of guidance almost entirely across the board. Total company revenue for the quarter was stronger than expected beating guidance at 121.7 million. BlackBerry delivered solid profitability with adjusted EBITDA growing over 55% year over year and beating the top end of the guidance range at $16.4 million. Likewise, non-GAAP earnings per share beat guidance at positive $0.02. And despite seasonality in our cash flow for the first half of the year, this stronger profitability helped to deliver better than expected operating cash usage of $18 million. In May, we announced a $100 million share buyback program based on our confidence in our plan to both continue generating cash as well as driving increased shareholder value. During the quarter, we started to utilize the capital allocation optionality that this facility brings by repurchasing $10 million worth of shares. Tim will provide more details on this later in the call. I'll now give some color on how we executed at a divisional level starting with QNX. QNX revenue for Q1 beat the upper end of our guidance range at 57.5 million. This represents 8% year-over-year growth despite the uncertainty facing the auto market including the impact of various tariff announcements. Royalties and development seat licenses were the main drivers of year-over-year revenue growth for the quarter, growing 9% and 23% respectively. We have a strong plan for profitable growth in QNX, capitalizing on both our market position and the multi-year secular tailwinds that are driving this business forward. As part of this, for fiscal year 26, we have two key strategies that we believe will help drive future growth. These are to both increase diversification of the business beyond automotive into adjacent verticals and to increase our share of the automotive software stack by offering pre-integrated middleware as part of a vehicle platform. Starting with increasing diversification beyond automotive, we believe this has a number of benefits. First, we see a very significant addressable market in the general embedded space, which we believe could be larger than the auto opportunity. Second, although we're very diversified across auto OEMs and geographies, diversification into other markets can reduce cyclical exposures. We're targeting substantial expansion of our beachheads in robotics, industrial automation, and medical devices and equipment. Similar to automotive, these verticals are seeing significant growth in compute and safety critical software at the edge, which is where QNX really excels. With minimal adaptations to the core QNX code base, we are able to meet the needs of customers, and therefore, we see this as primarily a go-to-market task. Accordingly, we're adding industry expertise and growing our gem-focused sales force. We're also working towards engaging new channel partners that will greatly increase our reach in these markets. SDP 8.0, our next generation version of the QNX operating system, is progressing well in this market, and we have a strong non-automotive mix in the pipeline. In fact, GEM currently represents 43% of our total SDP 8.0 pipeline with the overall pipeline having grown by 55% in the quarter. Further, our largest SDP 8.0 design win to date was with a leading industrial automation OEM. They will deploy the latest version of QNX across multiple applications. These are clear data points that show how our increased investment in GEM is already starting to generate real returns. The second focus is the QNX vehicle platform that was announced earlier this year at CES. We're developing this product in response to requests from some leading OEMs who have identified the importance of focusing their teams on customer-facing applications rather than spending time on undifferentiated parts of the software stack. Yesterday, we announced a memorandum of understanding with a leading middleware provider, Vector, to provide a highly integrated hardware agnostic solution that customers can leverage across the vehicle. This builds on an earlier announcement with both Vector and TT Tech at CES in January. The goal is to help our customers simplify development and shorten time to market. We are in conversations with several OEMs for this solution and are targeting delivery of an early access version of the product this calendar year. We continue to refine the business model for this platform, but should it be successful, directionally, we expect it to provide a significant uplift to our royalty ASP once deployed in vehicles. We were excited to announce the launch of QNX Hypervisor 8.0 at the end of the quarter. The hypervisor is an important part of our portfolio, allowing customers to virtually host guest operating systems like Android and Linux alongside safety-critical applications running on QNX, all on the same chip. Upgrading the hypervisor to the next generation performance standards of our SDP 8.0 operating system can help cement our leadership position within mixed criticality domains like the digital cockpit. QNX thrives in high performance, safety critical use cases. Autonomous drive is a great example. This past quarter, we announced that WeRide, a global leader in autonomous drive technology, is using QNX as the foundation for L2 plus passenger vehicles. In fact, this technology is already being deployed in a couple of Cherries vehicle models that are on the road in China today. As autonomous drive continues to ramp worldwide, we see this as an exciting opportunity for BlackBerry. We're working to build the QNX ecosystem through the availability of QNX products for non-commercial use and the development of QNX-centric training programs. We believe that having a stronger community of developers and partners with QNX experience will help drive adoption across OEMs, especially in the general embedded market. This quarter, we initiated a program in India with more than 30 educational institutions developing or currently offering QNX-focused courses. We're also working with institutions in North America with the goal of launching additional courses this calendar year. In terms of the macro, there is clearly uncertainty in the market, which we are currently having to navigate with some of our customers pulling guidance until market conditions become clearer. While we have not seen any direct impacts from the automotive tariffs, there have been some delays to customer buying decisions due to this macro uncertainty. As the OEMs navigate possible disruption to supply chains, there could also potentially be impacts on production volumes, which could impact royalty revenue. We're taking these factors into account in our guidance, and we'll continue to monitor closely as we head through this fiscal year. Moving now to our secure communications division. This was a strong quarter for the division, beating the top end of our guidance range with quarterly revenue of $59.5 million. Annual recurring revenue, or ARR, was stable at $209 million. Our dollar-based net retention rate, or DBNRR, also remained relatively flat at 92%. These stable fundamentals position the secure communications division well as a solid source of EBITDA and cash flow for BlackBerry. The stronger than expected revenue number was in large part driven by the strength of our SecuSmart product. This was another strong quarter for sales to the German government where we closed some large deals earlier than expected. In addition to the core German market, the pipeline of potential deals with customers around the world continues to grow, especially where we're seeing significantly increased budgets, particularly in defense. Governments are increasingly evaluating the tools they use in the wake of vulnerabilities seen in using consumer-focused platforms for critical communications. While sales cycles in governments are typically long, we are optimistic about our ability to close additional deals for SecuSmart this fiscal year. During Q1, Ad Hoc earned FedRAMP high authorization, the highest level of attainment for safeguarding mission-critical sensitive data within the U.S. federal government. As the first critical event management platform to achieve FedRAMP high, this further strengthens our moat and further expands our addressable market. During the quarter, we secured wins for ad hoc with several U.S. federal organizations, including the U.S. Marine Corps, U.S. Air Force, Senate, FEMA, the White House communications agencies, as well as other organizations in Germany and Canada. Moving on to our unified endpoint management product, BlackBerry UEM. UEM continues to perform as expected with some ongoing churn with customers moving to a cloud-based architecture partially offset by by a deepening of our on-premise mode for those customers who particularly value data sovereignty. One of the legacy players in this market has signaled the end of life for their on-premise solution. In contrast, we continue to make targeted investments. This quarter, we secure deals for UEM with a broad spectrum of customers, including the U.S. Special Operations Command, U.S. Air Force, the U.K. Sellafield Nuclear Power Establishment and National Grid, the Qatar National Bank, leading U.S. Bank Oppenheimer, and the Netherlands Government Shared Services. These data points increase our confidence in both defending and expanding our UEM on-premise customer base. Touching briefly on IP licensing, this was a solid quarter where revenue from pre-existing licensing deals drove the quarterly result of $4.7 million. We understand that Maliki, the party that purchased our non-core patents in 2024, is pursuing a number of potential licensing opportunities. Should they be successful, BlackBerry will participate in the profit they generate. While we do not expect incremental revenue this current year, it could provide upside in fiscal year 27 and fiscal year 28. With that, let me now turn the call over to Tim, who will provide further details on our financials.