BlackBerry completes transformation just as demand grows for secure, sovereign defence communications

BlackBerry Ltd. headquarters in Waterloo, Ont. Photo by Cole Burston/BloombergArticle contentBlackBerry Ltd.‘s transformation and return to profitability comes at a seemingly opportune time, as governments and companies look for secure, sovereign defence-tech solutions amid rising geopolitical tensions.Sign In or Create an AccountEmail AddressContinueor View more offersArticle contentThe Waterloo, Ont.-based company released its fourth quarter earnings results on Thursday, with revenue up 10 per cent to $156 million and total adjusted EBITDA up 71 per cent to $36.1 million.Article contentWe apologize, but this video has failed to load.Try refreshing your browser, ortap here to see other videos from our team.We apologize, but this video has failed to load.Try refreshing your browser, ortap here to see other videos from our team.Play VideoArticle contentArticle content“When this new management team was appointed, we promised to turn around (and) transform BlackBerry into a profitable growth company, and I’m pleased to report that we’ve done exactly that,” chief executive John Giamatteo said during the company’s earnings call on Thursday morning.Article contentTop StoriesGet the latest headlines, breaking news and columns.There was an error, please provide a valid email address.Sign UpBy signing up you consent to receive the above newsletter from Postmedia Network Inc.Thanks for signing up!A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againInterested in more newsletters? Browse here.Article content“The turnaround is complete, and the BlackBerry story is now a growth story.”Article contentBlackBerry’s QNX business, tailored for mission-critical embedded systems, posted record quarterly revenue of $78.7 million in the quarter, up 20 per cent from a year ago. This is QNX’s second consecutive quarter of record revenue, exceeding the top end of the guidance range.Article contentGiamatteo attributed the rise in revenue to record royalties and development fees.Article content“This is not a business that is slowing down, but rather one that is compounding, powered by our continued leadership in automotive and growing momentum across physical AI, robotics, industrial, medical and emerging markets,” he said.Article contentBlackBerry’s operating system is mainly used in the automotive industry, by clients such as BMW, Bosch, Continental, Dongfeng Motor, Geely, Honda, Mercedes-Benz, Toyota, Volkswagen and Volvo.Article contentArticle contentThe company’s biggest win in the quarter was signing a deal with a tier one supplier for the Chinese market, said Giamatteo. BlackBerry announced in December that QNX will be deployed across a Chinese automaker’s luxury electric vehicle (EV) lineup, launching this year.Article contentRead More BlackBerry cofounder Michael Lazaridis invests in Vancouver-based AI startup Feds to invest millions in startup accelerator to boost Canadian defence and dual-use companies Article content“China remains a large, valuable and growing market for us, demonstrated by this win,” the CEO said.Article contentMeanwhile, its Secure Communications segment, which provides defence-grade communications, had revenue growth of eight per cent to $72.5 million and 55 per cent growth in adjusted EBITDA to $19.5 million.Article contentGiamatteo said the result “would have seemed unthinkable a year ago.” He said the company believes there is under-recognized value within its portfolio.Article content“Just over a year ago, the Secure Communications division was barely discussed. In fact, at the time, it was viewed as a drag on our overall story,” he said. “As we (shift) focus from a broader cyber portfolio to our core strengths in mission critical secure communications and digital sovereignty, today the situation has changed considerably.”Trending Why are Canadian bond yields surging? Finance BYD to open 20 car dealerships in Canada this year Autos Posthaste: How the U.S. dollar stole the Canadian dollar's petrocurrency thunder News How the global energy crisis is shaking Canada from coast to coast — and could leave a lasting legacy Oil & Gas 'Time to shift that narrative' — RBC to launch $1-billion fund to help Canadian businesses grow Banking Article contentHe said digital sovereignty, the desire for governments to retain critical data and communications on sovereign solutions, hosted and operated in-country, is “no longer a buzzword.” Instead, it is a budget line item for governments worldwide, “and we are winning in this space,” he said.Article contentBlackBerry’s Secure Communications’ performance was primarily driven by sales to the German government, he said. It also recently announced a multi-year extension and expansion to its contract with Shared Services Canada, the Canadian government agency responsible for delivering and operating IT infrastructure and digital services for most federal agencies.Article contentThe deal with the federal government will significantly increase the deployment of BlackBerry’s encrypted communications solution used to support sensitive Government of Canada communications through 2033.Article content• Email: dpaglinawan@postmedia.comArticle contentShare this article in your social networkCommentsYou must be logged in to join the discussion or read more comments.Create an AccountSign in Join the Conversation Postmedia is committed to maintaining a lively but civil forum for discussion. Please keep comments relevant and respectful. Comments may take up to an hour to appear on the site. You will receive an email if there is a reply to your comment, an update to a thread you follow or if a user you follow comments. Visit our Community Guidelines for more information. Why are Canadian bond yields surging? Finance BYD to open 20 car dealerships in Canada this year Autos Posthaste: How the U.S. dollar stole the Canadian dollar's petrocurrency thunder News How the global energy crisis is shaking Canada from coast to coast — and could leave a lasting legacy Oil & Gas 'Time to shift that narrative' — RBC to launch $1-billion fund to help Canadian businesses grow Banking