BlackBerry Limited

Good morning and welcome to the BlackBerry second quarter fiscal year 2026 results conference call. My name is Michael 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 today's call over to Martha Gonder, Director of Investor Relations, BlackBerry. Please go ahead.

Thank you, Michael. Good morning, everyone, and welcome to BlackBerry's second 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. and Canadian securities laws. will 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 the Edgar, Cedar Plus, and BlackBerry.com websites. And with that, let me turn the call over to John.

Well, thanks, Martha, and thanks to everyone for joining today's call. Q2 was another strong quarter for BlackBerry with all three of our divisions beating the top end of guidance. The company revenue for the quarter was stronger than expected, growing 3% year over year to $129.6 million. BlackBerry delivered another quarter of solid profitability with total company adjusted EBITDA reaching 20% of revenue and gap net income being positive for the second consecutive quarter at $13.3 million. Likewise, non-gap EPS beat guidance at positive $0.04. Despite the headwinds of significant tax payments in the quarter, we were able to return to positive cash flow earlier than anticipated with operating cash flow at $3.4 million. At a divisional level, QNX beat expectations for both revenue and adjusted EBITDA to achieve a rule of 40 quarter. We delivered 15% year-over-year revenue growth and a 32% adjusted EBITDA margin for Q2. QNX revenue for the quarter was $63.1 million, primarily driven by strong royalties. These solid results are a testament to how the QNX team continues to successfully navigate what remains an uncertain macro environment. This is further evidenced by QNX design wins being ahead of plan in Q2 after a slower start to the year in Q1. The pipeline for potential design wins in the second half of this fiscal year looks solid. In the quarter, we secured a number of noteworthy design wins, including a mid eight figure design win in the Chinese market with a leading global tier one supplier to power ADAS applications. QNX is also progressing with ecosystem partners. BMW and Qualcomm announced that they have jointly developed a scalable platform called Snapdragon Ride Pilot which is built on QNX. This product offered by Qualcomm to all global automakers and tier one suppliers enables an active safety system that is continually updated with cloud-based information from global fleets. We secured another win for our cloud-based development platform, Cabin, with one of the top five global automakers. This was also a significant quarter for our QNX sound product, where we had a pivotal win to deliver software-defined audio with a leading domestic Chinese automaker and a leading branded audio partner. This marks a significant step forward in adoption of this product. Like in auto, we continue to see growth in a number of high performance, safety critical use cases in the general embedded space. In particular, we're seeing progress in the verticals where we've been increasing focus and investment, namely medical instrumentation, industrial automation, and robotics. During this past quarter, we secured a significant win with a leading North American camera and vision module supplier for QNX to be used globally in automated mobile robots and subsequently in humanoid robotics. This is another data point that our investment strategy is showing returns. During the quarter, the latest version of our QNX operating system passed the safety and security audits conducted by TUV Rhineland and QNX OS for Safety 8.0 was formally released on July 31st. Having the product fully certified by arguably the leading body in this space allows customers to demonstrate the product's compliance with rigorous international standards. The QNX 8 pipeline continues to grow and remains approximately 50-50 between Otto and Jim. And this pipeline is being converted. In Q2, a top global automaker purchased new QNX 8 development seat licenses. We also announced that QNX OS for Safety 8 will power NVIDIA's Drive AGX Thor development kit. This kit enables software development on the NVIDIA AGC Thor SOC, a truly powerful next generation chip that facilitates generative AI. QNX forms the foundation for NVIDIA's DriveOS that is often used in conjunction with NVIDIA chipsets in the car. There was also meaningful progress for the vehicle software platform that we're investing in and have partnered with Vector Informatic to develop. The platform pre-integrates our operating system with a number of middleware components. We believe that this platform will help automakers accelerate their path to software-defined vehicles, greatly expanding QNX's addressable market and increasing our overall software content in the car. We were excited to launch the first early access version of this product this past quarter, and we're working closely with Vector to implement and accelerate our go-to-market strategy. We continue to see momentum with QNX Everywhere, our initiative to accelerate the growth of the QNX developer and ecosystem community through the availability of our products for non-commercial use and the development of QNX-centric training programs. We see this as a strategically important program that aims to significantly strengthen the position of QNX in the market for the long term. This past quarter, MIT was one of six universities to sign up to using QNX in their engineering curriculums, with more than 4,000 students having already attended QNX learning sessions globally. So in summary, despite the continued uncertainty in the automotive market, BlackBerry's QNX division delivered strong results in Q2 and progress across all our key growth initiatives. And we have a solid pipeline of opportunities for the second half of the fiscal year. Moving now on to Secure Communications Division, which had another solid quarter beating the top end of our guidance range and finishing higher sequentially with quarterly revenue of $59.9 million. The better-than-expected results were driven by a combination of slowing customer churn for UEM as well as some upside for both Ad Hoc and SecuSmart. Annual recurring revenue, or ARR, grew by $4 million in the quarter to $213 million, and the dollar-based net retention rate, or DBNRR, improved to 93%. Although the revenue was down year over year due to a significant device refresh cycle last fiscal year, this was a good quarter for sales of SecuSMART to the German government, including a five-year deal with a key government agency for hosted secure voice services. Offering a hosted service is a new recurring revenue business model for BlackBerry that together with more software-only sales can help create a more predictable revenue profile for the SecuSmart business. This deal can serve as a test case and opened the door for future deals of this nature. We also saw traction with deployment of SecuSmart on iOS devices. In the past, SecuSmart was largely limited to Android. The R&D effort to add support for iOS has significantly increased the size of our potential opportunity within the German government. Outside of Germany, this quarter we secured a deal with a Canadian government entity, and the pipeline of opportunities globally remains robust. During Q2, we secured a large renewal and upsell with the U.S. State Department for our ad hoc critical events management platform. This deal includes four option years, which could result in this being a five-year renewal. FedRAMP high approval and new features added to the ad hoc platform recently were key for the State Department in expanding their relationship with BlackBerry for their emergency notification and accountability platform. In addition, we secured ad hoc wins with the United States Coast Guard and Veteran Affairs, among others. As mentioned, this quarter we saw the continuation of the trend for reduced customer churn for UEM. An increased focus on data sovereignty plays to BlackBerry UEM strength, especially with on-premise deployments. In particular, we secured a number of non-government renewals that helped solidify the base. Renewals including a number of major financial institutions, as well as Rolls-Royce, leading law firm Hogan Lovells, defense engineering firm Babcock, the IRS, and the Department of Homeland Security, just to name a few. During the quarter, BlackBerry UEM became the first solution to be certified by Germany's Federal Office for Information Security, or BSI. Meeting these very rigorous standards shows BlackBerry's commitment to this market and opens up potential for UEM expansion opportunities in Germany. Overall, this was another solid quarter for SecureComps. The pipeline of potential large deals with government customers continues to be strong. However, sales cycles remain relatively long. Touching briefly on IP licensing, in addition to the run rate revenue from pre-existing arrangements, which remains solid, we secured a net new one-time deal in the quarter that helped revenue to beat expectations at 6.6 million. And with that, let me now turn the call over to Tim for more color on our financials.