BlackBerry reveals revenue target from IoT and Cyber Security

BlackBerry said it is targeting total revenue of $886 million in fiscal 2025 and $1,213 million in fiscal 2027 as compared with $655 million it achieved in fiscal 2022.
BlackBerry IoT businessBlackBerry is targeting revenue of $307 million from IoT business in fiscal 2025 and $443 million in fiscal 2027 as compared with $178 million it achieved in fiscal 2022.

BlackBerry is targeting revenue of $579 million from Cyber Security business in fiscal 2025 and $770 million in fiscal 2027 as compared with $477 million it achieved in fiscal 2022.

BlackBerry is targeting an average 100+ basis points increase in gross margin per year to FY27. BlackBerry is aiming for operating margin of approximately 20 percent by FY27.

BlackBerry will be investing approximately 30 percent of revenue on Research & Development in FY23.

IoT:

IoT Serviceable Addressable Market (SAM) is expected to grow at approximately 8-12 percent per year from FY23 to FY26.

Revenue growth for the IoT business unit is expected to exceed the market growth rate resulting in an increase in market share above the current level of 26 percent in core automotive domains.

Revenue from production-based royalties is expected to grow faster than revenue from the pre-production design phase, increasing the portion of total revenue from royalties.

The SAM for BlackBerry IVY is expected to be approximately $800 million in FY25.

BlackBerry is targeting its first IVY design wins in FY23.

Cybersecurity:

The SAMs for endpoint security and managed cybersecurity services are expected to grow at 15 percent and 14 percent, respectively, per year to FY27.

Revenue for the Cybersecurity business unit, excluding UEM, is expected to grow with a 5-year CAGR of approximately 16 percent to FY27.

Churn in the UEM customer base is expected to negatively impact revenue and Annual Recurring Revenue (ARR) in FY23, but the impact is expected to become less significant from FY24 onwards.

Approximately 20 percent of the UEM customer base is in non-core verticals, and those customers, representing annual revenue in the region of $40 million, are exhibiting higher than average churn.

Approximately 64 percent of the Cylance customer base currently buys 1 Cylance module, and approximately 27 percent buy 2 modules. Management is targeting selling additional modules to these customers.

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