BlackBerry (NYSE:BB) Shares Down 5.3% - Here's Why

Key Points

• BlackBerry shares fell 5.3% to about $8.27 despite the company reporting second-quarter adjusted EPS of $0.07 and revenue of roughly $166.6 million, both ahead of analyst expectations.
• Strong QNX automotive performance and improved profitability led management to raise fiscal 2027 revenue guidance to $616 million–$636 million and EPS guidance to $0.19–$0.22.
• Near-term fiscal Q3 revenue guidance came in below expectations, potentially driving profit-taking. Analysts maintain a consensus “Hold” rating, with a target price near $8.83, offering limited upside from recent levels.

BlackBerry Limited (NYSE:BB - Get Free Report)'s share price was down 5.3% during mid-day trading on Friday. The company traded as low as $8.19 and last traded at $8.2670. Approximately 9,566,385 shares changed hands during mid-day trading, a decline of 48% from the average session volume of 18,353,047 shares. The stock had previously closed at $8.73.

Key Stories Impacting BlackBerry

Here are the key news stories impacting BlackBerry this week:

• Positive Sentiment: BlackBerry’s Q2 adjusted EPS of $0.07 exceeded the $0.04 analyst consensus, while revenue rose 26% year over year to approximately $163 million, also topping expectations. BlackBerry Surpasses Q2 Earnings and Revenue Estimates
• Positive Sentiment: The QNX automotive software division delivered record quarterly revenue, supported by core automotive strength and new design wins. BlackBerry also secured its first Alloy Kore design win, described as the largest in QNX history. BlackBerry Lifts Annual Revenue Forecast
• Positive Sentiment: Profitability and cash generation improved substantially: adjusted EBITDA increased 81% year over year, GAAP operating income rose 192%, operating cash flow reached $29 million, and the company recorded its sixth consecutive quarter of positive GAAP net income. BlackBerry Reports Second Quarter Fiscal Year 2027 Results
• Positive Sentiment: Management raised fiscal 2027 revenue guidance to $616 million–$636 million, above the roughly $614 million consensus, and lifted EPS guidance to $0.19–$0.22 from the $0.18 consensus. The stronger outlook reinforces the turnaround and QNX growth thesis. BB Q2 Earnings Top and FY27 Outlook Raised
• Neutral Sentiment: Unusually high call-option activity, up 63% from average volume, indicates increased speculative interest but does not establish a fundamental valuation signal.
• Neutral Sentiment: Analysts’ consensus price target is approximately $8.92, suggesting only modest potential upside relative to recent trading levels. BlackBerry Consensus Target Price
• Negative Sentiment: Fiscal Q3 EPS guidance of $0.04–$0.05 is centered around or below the $0.05 consensus, while revenue guidance of $143 million–$154 million has a midpoint below expectations. This weaker near-term outlook may be prompting profit-taking despite the full-year raise. BlackBerry Stock and Q2 Guidance

Analysts Set New Price Targets

A number of equities research analysts have recently weighed in on the stock. Royal Bank Of Canada restated a "sector perform" rating and issued a $9.00 price target on shares of BlackBerry in a research note on Monday. Stifel Nicolaus began coverage on shares of BlackBerry in a research note on Wednesday, June 24th. They issued a "buy" rating and a $12.00 price objective for the company. Raymond James Financial raised their target price on shares of BlackBerry from $4.75 to $9.50 and gave the company a "market perform" rating in a research report on Friday, June 26th. TD upped their price target on shares of BlackBerry from $5.00 to $8.00 and gave the stock a "hold" rating in a report on Friday, June 26th. Finally, Canaccord Genuity Group dropped their price target on BlackBerry from $10.30 to $9.50 and set a "hold" rating for the company in a research note on Friday. Two investment analysts have rated the stock with a Buy rating, eight have given a Hold rating and one has assigned a Sell rating to the stock. Based on data from MarketBeat.com, the company has a consensus rating of "Hold" and a consensus target price of $8.83.

BlackBerry Trading Down 6.8%

The company has a current ratio of 2.20, a quick ratio of 2.20 and a debt-to-equity ratio of 0.26. The firm has a market capitalization of $4.78 billion, a price-to-earnings ratio of 90.29 and a beta of 2.23. The firm's 50-day moving average is $8.31 and its 200 day moving average is $7.37.

BlackBerry (NYSE:BB - Get Free Report) last announced its quarterly earnings results on Thursday, September 24th. The company reported $0.07 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.04 by $0.03. The firm had revenue of $166.56 million during the quarter, compared to analysts' expectations of $144.22 million. BlackBerry had a net margin of 10.31% and a return on equity of 11.66%. The company's revenue was up 26.0% on a year-over-year basis. During the same period in the prior year, the company posted $0.04 EPS. BlackBerry has set its FY 2027 guidance at 0.190-0.220 EPS and its Q3 2027 guidance at 0.040-0.050 EPS. On average, equities analysts predict that BlackBerry Limited will post 0.13 earnings per share for the current fiscal year.

Insider Buying and Selling

In other BlackBerry news, CFO Tim Foote sold 25,878 shares of BlackBerry stock in a transaction dated Thursday, July 2nd. The stock was sold at an average price of $12.39, for a total transaction of $320,628.42. Following the transaction, the chief financial officer directly owned 58,372 shares of the company's stock, valued at approximately $723,229.08. The trade was a 30.72% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this link. Also, CEO John Giamatteo sold 152,012 shares of the company's stock in a transaction dated Thursday, July 9th. The shares were sold at an average price of $11.35, for a total value of $1,725,336.20. Following the completion of the sale, the chief executive officer owned 687,246 shares in the company, valued at $7,800,242.10. This trade represents a 18.11% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold 355,858 shares of company stock valued at $4,012,270 in the last quarter. 0.51% of the stock is currently owned by company insiders.

Institutional Trading of BlackBerry

Several institutional investors have recently added to or reduced their stakes in the stock. CoreCap Advisors LLC bought a new position in BlackBerry during the 2nd quarter worth approximately $31,000. Integrated Wealth Concepts LLC bought a new stake in shares of BlackBerry in the 2nd quarter valued at $31,000. Elevation Wealth Partners LLC acquired a new stake in shares of BlackBerry during the second quarter worth $32,000. Wealthfront Advisers LLC acquired a new stake in shares of BlackBerry during the first quarter worth $34,000. Finally, Bank of New York Mellon Corp bought a new position in BlackBerry during the first quarter worth $37,000. 54.48% of the stock is currently owned by institutional investors.

About BlackBerry

BlackBerry Limited is a Canadian software company headquartered in Waterloo, Ontario, that provides cybersecurity and Internet of Things (IoT) solutions to enterprises, governments and other organizations worldwide. Its cybersecurity offerings include endpoint protection, endpoint management, identity and access controls, secure communications, and tools designed to help organizations monitor and respond to cyber threats.

The company's IoT business is built around QNX, a software platform used in automotive systems and other embedded applications.

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