What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-04-09 compared with 2025-04-02 · 372 added, 389 removed, 613 unchanged (55% of the section changed)

11 unchanged sentences

Additional information about the Company can be found on SEDAR+ at www.sedarplus.ca and on the SEC’s website at www.sec.gov.

On February 3, 2025, the Company completed the sale of its Cylance endpoint security assets and related liabilities to Arctic Wolf Network, Inc.

On February 3, 2025, the Company completed the sale of its Cylance endpoint security assets and related liabilities to Arctic Wolf Networks, Inc.

(“Arctic Wolf”) for $160.0 million of cash, subject to certain adjustments of approximately $42.1 million, and 5.5 million common shares of Arctic Wolf.

As a result of the Cylance sale, it is no longer reported alongside UEM, SecuSuite and AtHoc as the Cybersecurity segment, and those three businesses are now reported separately from Cylance as the Secure Communications segment.

The financial results of Cylance are presented as discontinued operations and are included in “loss from discontinued operations, net of tax” in the Consolidated Statements of Operations and have been removed from the presentation of results from continuing operations.

Prior period comparatives in the financial statements, and throughout this Annual Report on Form 10-K where applicable, have been recast to reflect this change

As a result of the Cylance sale, it is no longer reported alongside UEM, SecuSUITE and AtHoc as the Cybersecurity segment.

Effective from the fiscal year ended February 28, 2025, those three businesses are reported separately from Cylance as the Secure Communications segment.

The financial results of Cylance are presented as discontinued operations and are included in “loss from discontinued operations, net of tax” in the Consolidated Statements of Operations.

For a discussion on “loss from discontinued operations, net of tax” for the fiscal year ended February 28, 2025 compared to our fiscal 2024 financial results, please refer to our MD&A included in our Annual Report on 10-K for the fiscal year ended February 28, 2025, which is incorporated herein by reference.

Cautionary Note Regarding Forward-Looking Statements

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Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws, including statements relating to:

• the Company’s plans, strategies and objectives, including its intentions to increase and enhance its product and service offerings and to patent new innovations;

• the Company’s expectations with respect to its revenue, segment adjusted EBITDA, adjusted Corporate general and administrative costs, adjusted EBITDA, non-GAAP EPS and operating cash flow in the first quarter of fiscal 2026, and these items for fiscal 2026 as a whole;

• the Company’s plans, strategies and objectives, including its intentions to increase and enhance its product and service offerings, and patent new innovations;

• the Company’s expectations with respect to its total and segment revenue and adjusted EBITDA, adjusted Corporate operating costs, non-GAAP EPS and operating cash flow in the first quarter of fiscal 2027 and for fiscal 2027 as a whole;

• the Company’s estimates of purchase obligations and other contractual commitments;

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The words “expect”, “anticipate”, “estimate”, “may”, “will”, “should”, “could”, “intend”, “believe”, “target”, “plan” and similar expressions are intended to identify forward-looking statements in this Annual Report on Form 10-K, including in the sections in Part I, Item 1 “Business” entitled “The Company:

A heritage of innovation”, “Industry Background - QNX”, “Competition and Competitive Strengths - QNX”, “Intellectual Property” and “Human Capital”, and in the sections of this MD&A entitled, “Results of Operations - Fiscal year ended February 28, 2025 compared to fiscal year ended February 29, 2024 - Revenue - Revenue by Segment”, “Results of Operations - Fiscal year ended February 28, 2025 compared to fiscal year ended February 29, 2024 - Gross Margin and Adjusted EBITDA by Segment”, “Results of Operations - Fiscal year ended February 28, 2025 compared to fiscal year ended February 29, 2024 - Operating Expenses - General and Administrative Expenses”, “Results of Operations - Fiscal year ended February 28, 2025 compared to fiscal year ended February 29, 2024 - Net Loss ”, and “Financial Condition - Contractual and Other Obligations”.

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 appropriate in the circumstances, including but not limited to, the Company’s expectations regarding its business, strategy, opportunities and prospects, the launch of new products and services, general economic conditions, competition, the Company’s expectations regarding its financial performance, and the Company’s expectations regarding the planned separation of its businesses.

A heritage of innovation”, “Industry Background - QNX”, “Competition and Competitive Strengths - QNX”, “Intellectual Property” and “Human Capital”, and in the sections of this MD&A entitled, “Results of Operations - Fiscal year ended February 28, 2026 compared to fiscal year ended February 28, 2025 - Revenue - Revenue by Segment”, “Results of Operations - Fiscal year ended February 28, 2026 compared to fiscal year ended February 28, 2025 - Gross Margin and Adjusted EBITDA by Segment”, “Results of Operations - Fiscal year ended February 28, 2026 compared to fiscal year ended February 28, 2025 - Operating Expenses - General and Administrative Expenses”, “Results of Operations - Fiscal year ended February 28, 2026 compared to fiscal year ended February 28, 2025 - Net Income (loss)”, and “Financial Condition - Contractual and Other Obligations”.

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 appropriate in the circumstances, including but not limited to, the Company’s expectations regarding its business, strategy, opportunities and prospects, the launch of new products and services, general economic conditions, competition, and the Company’s expectations regarding its financial performance.

Many factors could cause the Company’s actual results, performance or achievements to differ materially from those expressed or implied by the forward-looking statements, including, without limitation, the risk factors discussed in Part I, Item 1A “Risk Factors” in this Annual Report on Form 10-K.

All of these factors should be considered carefully, and readers should not place undue reliance on the Company’s forward-looking statements.

Any statements that are forward-looking statements are intended to enable the Company’s shareholders to view the anticipated performance and prospects of the Company from management’s perspective at the time such statements are made, and they are subject to the risks that are inherent in all forward-looking statements, as described above, as well as difficulties in forecasting the Company’s financial results and performance for future periods, particularly over longer periods, given changes in technology and the Company’s business strategy, evolving industry standards, intense competition and short product life cycles that characterize the industries in which the Company operates.

Any statements that are forward-looking statements are intended to enable the Company’s shareholders to

view the anticipated performance and prospects of the Company from management’s perspective at the time such statements are made, and they are subject to the risks that are inherent in all forward-looking statements, as described above, as well as difficulties in forecasting the Company’s financial results and performance for future periods, partic ularly over longer periods, given changes in technology and the Company’s business strategy, evolving industry standards, intense competition and short product life cycles that characterize the industries in which the Company operates.

See the “Strategy” subsection in Part I, Item 1 “Business” of this Annual Report on Form 10-K.

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Based in Waterloo, Ontario, the Company’s high-performance foundational software enables major automakers and industrial giants alike to unlock transformative applications, drive new revenue streams and launch innovative business models, all without sacrificing safety, security, and reliability.

With a deep heritage in Secure Communications, BlackBerry delivers operational resiliency with a comprehensive, highly secure, and extensively certified portfolio for mobile fortification, mission-critical communications, and critical events management.

With a deep heritage in Secure Communications, the Company delivers operational resiliency with a comprehensive, highly secure, and extensively certified portfolio for mobile fortification, mission-critical communications, and critical events management.

The Company’s common shares trade under the ticker symbol “BB” on the New York Stock Exchange and the Toronto Stock Exchange.

The Company was incorporated under the Business Corporations Act (Ontario) on March 7, 1984.

The Company continued to execute on its strategy in fiscal 2025 and announced the following significant achievements:

The Company has continued to execute on its strategy in fiscal 2026 and announced the following significant achievements:

Products and Innovation:

• QNX announced that its embedded technology powers more than 255 million vehicles;

• QNX launched its General Embedded Development Platform to accelerate developer innovation for embedded systems;

• QNX introduced a software-defined functional safety platform for industrial automation in collaboration with Intel;

• QNX added QNX® Containers to support operating system virtualization and containerization on QNX-based devices;

• BlackBerry UEM placed in the upper-right quadrant as a 2024 Gartner® Peer Insights™ Customers’ Choice for Unified Endpoint Management tools;

• The Company announced that BlackBerry AtHoc is “in process” to become the first critical events management solution to obtain FedRAMP high authorization.

• QNX announced that more than 275 million vehicles on the road are being powered by QNX’s embedded technology;

• QNX launched QNX Hypervisor 8.0, built on the next-generation SDP 8.0 architecture, facilitating high-performance virtualization of multiple operating systems on a single system-on-a-chip;

• QNX launched its foundational, safety-certified QNX OS for Safety 8.0 to streamline the development and certification of safety- and security-critical embedded systems;

• QNX SDP 8.0 was updated to add support for AMD Ryzen Embedded x86 processors;

• BlackBerry became the first Mobile Device Management (MDM) vendor to achieve BSI certification for BlackBerry UEM deployment with Apple Indigo and Samsung Knox;

• BlackBerry AtHoc became the first critical event management provider to achieve FedRAMP High authorization;

• BlackBerry announced the expansion of BlackBerry SecuSUITE to Windows devices, extending sovereign-grade protection across the digital workplace.

Customers and Partners:

• The Company completed the sale of its Cylance endpoint security assets to Arctic Wolf;

• QNX collaborated with Microsoft to make QNX SDP 8.0 available in the Microsoft Azure cloud environment;

• QNX announced a multi-year collaboration with Vector and TTTech Auto to develop and market a vehicle software platform that pre-integrates the QNX OS with other leading middleware components;

• QNX partnered with Pi Square Technologies to train software engineers across India as part of QNX Everywhere ecosystem expansion strategy;

• QNX extended its relationship with AMD to support a wider range of adaptive computing devices used in robotic systems and other embedded devices;

• QNX was selected by Hyundai Mobis to power its next-generation digital cockpit platform;

• QNX partnered with ETAS to jointly sell and market software solutions for SDVs;

• QNX was selected by FERNRIDE for its safety-certified autonomous terminal tractor solution;

• BlackBerry announced the Government of Canada’s investment in the Malaysia Cybersecurity Center of Excellence.

Environmental, Sustainability and Corporate Governance:

• Appointed Lori O’Neill, an experienced corporate director and financial expert, to the Board of Directors;

• Appointed Lisa Bahash, an automotive OEM and Tier 1 supplier veteran, to the Board of Directors;

• Appointed Tim Foote as Chief Financial Officer.

• Mercedes-Benz among automakers trialing early access version of QNX and Vector’s Alloy Kore platform;

• QNX technology to be integrated in BMW Group's next-generation ‘Neue Klasse’ software-defined vehicle architecture;

• QNX and NVIDIA announced general availability of NVIDIA DRIVE AGX Thor development kit, integrated with QNX OS for Safety 8 to enable developers to accelerate development of next-generation autonomous drive systems;

• QNX and Haleytek were chosen to enable software-defined audio using QNX Sound for the Volvo EX60 electric SUV;

• Leapmotor selected QNX technology as the foundation of its intelligent digital cockpit and autonomous drive domain controllers in its new B10 electric SUV;

• WeRide launched its next-generation ADAS platform for L2++ autonomous drive, built upon QNX OS for Safety;

• QNX announced that a leading Chinese automaker selected QNX Sound for their luxury EV lineup;

• Direct ChassisLink Inc (DCLI) announced the deployment of BlackBerry Radar across 100,000 chassis;

• BlackBerry, Global Affairs Canada, and Toronto Metropolitan University’s Rogers Cybersecure Catalyst expanded cybersecurity training in Malaysia;

• BlackBerry and Universiti Kebangsaan Malaysia announced a strategic partnership to advance Malaysia's future cyber-defenders and embedded software talent;

• Malaysia expanded the deployment of BlackBerry Secure Communications software for the 46th and 47th ASEAN Summits.

Strategy and Governance:

• BlackBerry appointed Barry Mainz to its Board of Directors;

• BlackBerry appointed John Wall as President of QNX Division;

• BlackBerry announced a share buyback program for the repurchase of up to 27,855,153 of its common shares.

Fiscal 2026 Summary Results of Operations

7 unchanged sentences

Investment income, net 10.7 7.7 3.0 18.8 (11.1)

Income (loss) before income taxes 8.5 29.8 (21.3) (201.8) 231.6

Income before income taxes 59.0 8.5 50.5 29.8 (21.3)

Provision for income taxes 5.8 17.0 (11.2) 24.2 (7.2)

2 unchanged sentences

— (70.5) 70.5 (135.8) 65.3

Net loss $ (79.0) $ (130.2) $ 51.2 $ (734.4) $ 604.2

Net income (loss) $ 53.2 $ (79.0) $ 132.2 $ (130.2) $ 51.2

Earnings (loss) per share - reported

5 unchanged sentences

______________________________

(1) As a result of the Cylance sale, it is no longer reported alongside UEM, SecuSuite and AtHoc as the Cybersecurity segment, and those three businesses are now reported separately from Cylance as the Secure Communications segment.

The financial results of Cylance are presented as “loss from discontinued operations, net of tax” in the Consolidated Statements of Operations and have been removed from the presentation of results from continuing operations.

Prior period comparatives have been recast to reflect this change.

(2) Diluted loss per share on a U.S.

(1) As a result of the Cylance sale, it is no longer reported alongside UEM, SecuSUITE and AtHoc as the Cybersecurity segment.

Effective from the fiscal year ended February 28, 2025, those three businesses are reported separately from Cylance as the Secure Communications segment.

The financial results of Cylance are presented as “loss from discontinued operations, net of tax” in the Consolidated Statements of Operations.

(2) Diluted earnings (loss) per share on a U.S.

GAAP basis for fiscal 2026, 2025 and 2024 do not include the dilutive effect of the Debentures (as defined below in “Debt Financing and Other Funding Sources”) as to do so would be anti-dilutive.

Diluted loss per share on a U.S.

GAAP basis for fiscal 2025 and fiscal 2023 do not include the dilutive effect of stock-based compensation as to do so would be anti-dilutive.

GAAP basis for fiscal 2025 does not include the dilutive effect of stock-based compensation as to do so would be anti-dilutive.

See Note 9 to the Consolidated Financial Statements for the fiscal year ended February 28, 2026 for calculation of the dilutive weighted average number of shares outstanding.

7 unchanged sentences

Investment income, net 3.0 1.6 1.4 4.0 (2.4)

Loss before income taxes (6.4) (8.5) 2.1 (95.0) 86.5

Income (loss) before income taxes 25.9 (6.4) 32.3 (8.5) 2.1

Provision for income taxes 1.6 1.4 0.2 3.9 (2.5)

Loss from continuing operations (7.8) (12.4) 4.6 (96.9) 84.5

Income (loss) from continuing operations 24.3 (7.8) 32.1 (12.4) 4.6

Income (loss) from discontinued operations (1)

— 0.4 (0.4) (43.8) 44.2

Net loss $ (7.4) $ (56.2) $ 48.8 $ (494.9) $ 438.7

Net income (loss) $ 24.3 $ (7.4) $ 31.7 $ (56.2) $ 48.8

Earnings (loss) per share - reported

5 unchanged sentences

______________________________

Prior period comparatives have been recast to reflect this change.

(1) As a result of the Cylance sale, it is no longer reported alongside UEM, SecuSUITE and AtHoc as the Cybersecurity segment.

Effective from the fiscal year ended February 28, 2025, those three businesses are reported separately from Cylance as the Secure Communications segment.

The financial results of Cylance are presented as “loss from discontinued operations, net of tax” in the Consolidated Statements of Operations.

(2) Diluted loss per share on a U.S.

GAAP basis in the fourth quarter of 2025 and 2024 do not include the dilutive effect of the Debentures as to do so would be anti-dilutive.

GAAP basis in the fourth quarters of 2025 and 2024 do not include the dilutive effect of the Debentures as to do so would be anti-dilutive.

Diluted loss per share on a U.S.

GAAP basis in the fourth quarter of 2025, 2024 and 2023 do not include the dilutive effect of stock-based compensation as to do so would be anti-dilutive.

The following tables show information by operating segment for the three months and years ended February 28, 2025 and February 29, 2024.

GAAP basis in the fourth quarters of 2025 and 2024 do not include the dilutive effect of stock-based compensation as to do so would be anti-dilutive.

The following tables show information by operating segments for the three months and years ended February 28, 2026 and February 28, 2025.

The Company reports segment information in accordance with U.S.

GAAP ASC Section 280 based on the “management” approach.

GAAP, pursuant to the Financial Accounting Standards Board’s Accounting Standard Codification Topic 280, Segment Reporting, based on the “management” approach.

The management approach designates the internal reporting used by the Chief Operating Decision Maker (“CODM”) for making decisions and assessing performance of the Company’s reportable operating segments.

The measure of segment profit or loss disclosed by the Company in the Consolidated Financial Statements under the “management” approach in reviewing the results of the Company’s operating segments is segment adjusted gross margin.

Additionally below, management uses the additional measures of segment profit or loss used by the CODM which is segment adjusted EBITDA a non-GAAP financial measure.

Also note the change in presentation relating to expense reclassification as disclosed in Note 1 to the Consolidated Financial Statements.

Additionally, the following tables include the additional measures of segment profit or loss used by the CODM which is segment adjusted EBITDA, a non-GAAP financial measure, which excludes amounts related to investment income, taxes, amortization, restructuring charges, stock compensation expenses and long-lived asset impairment charge.

For the three months and year ended February 28, 2026, the Company presented segment adjusted EBITDA results excluding amortization in segment research and development, segment sales and marketing and segment general and administrative to align to the operating expense presentation on the Consolidated Statement of Operations.

For purposes of comparability, the Company’s segment adjusted EBITDA for the three months and years ended February 28, 2025 and February 29, 2024 have been updated to conform to the current year’s presentation.

See Note 13 to the Consolidated Financial Statements for a description of the Company’s operating segments.

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(in millions)

Secure Communications QNX Licensing Segment Totals

Feb 28 Feb 29 Change Feb 28 Feb 29 Change Feb 28 Feb 29 Change Feb 28 Feb 29 Change

QNX Secure Communications Licensing

February 28, Change February 28, Change February 28, Change

2026 2025 2026 2025 2026 2025

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Segment general and administrative 8.5 8.2 0.3 7.5 9.2 (1.7) (1.5) 7.1 (8.6)

Less amortization included in the above 0.6 1.0 (0.4) 0.6 0.6 — 2.2 2.3 (0.1) 3.4 3.9 (0.5)

Less amortization included in segment cost of sales — — — — — — 1.5 1.5 —

Segment adjusted EBITDA (1)

For the Years Ended

$ 21.4 $ 19.2 $ 2.2 $ 19.5 $ 12.6 $ 6.9 $ 6.3 $ 1.4 $ 4.9

For the Three Months Ended

(in millions)

Secure Communications QNX Licensing Segment Totals

Feb 28 Feb 29 Change Feb 28 Feb 29 Change Feb 28 Feb 29 Change Feb 28 Feb 29 Change

QNX Secure Communications Licensing

Feb 28 Feb 29 Change Feb 28 Feb 29 Change Feb 28 Feb 29 Change

2025 2024 2025 2024 2025 2024

5 unchanged sentences

Segment general and administrative 8.2 10.4 (2.2) 9.2 10.9 (1.7) 7.1 2.7 4.4

Less amortization included in the above 3.2 4.4 (1.2) 2.3 2.9 (0.6) 9.0 9.7 (0.7) 14.5 17.0 (2.5)

Less amortization included in segment cost of sales — — — — 0.2 (0.2) 1.5 1.4 0.1

Segment adjusted EBITDA (1)

The following tables reconcile the Company’s segment gross margin for the three months and year ended February 28, 2025 to consolidated U.S.

GAAP results:

For the Three Months Ended February 28, 2025

(in millions)

Secure Communications QNX Licensing Segment Totals Reconciling Items Consolidated U.S.

Revenue $ 67.3 $ 65.8 $ 8.6 $ 141.7 $ — $ 141.7

Cost of sales 24.5 11.1 1.6 37.2 0.4 37.6

Gross margin (1)

$ 19.2 $ 17.7 $ 1.5 $ 12.6 $ 17.1 $ (4.5) $ 1.4 $ 12.7 $ (11.3)

Operating expenses 112.1 112.1

Investment income, net 1.6 1.6

Loss before income taxes $ (6.4)

For the Year Ended February 28, 2025

For the Years Ended

(in millions)

Secure Communications QNX Licensing Segment Totals Reconciling Items Consolidated U.S.

Revenue $ 272.6 $ 236.0 $ 26.3 $ 534.9 $ — $ 534.9

Cost of sales 92.7 38.8 6.1 137.6 2.4 140.0

Gross margin (1)

$ 179.9 $ 197.2 $ 20.2 $ 397.3 $ (2.4) $ 394.9

Operating expenses 394.1 394.1

Investment income, net 7.7 7.7

Income before income taxes $ 8.5

QNX Secure Communications Licensing

February 28, Change February 28, Change February 28, Change

2026 2025 2026 2025 2026 2025

(1) See “Non-GAAP Financial Measures” for a reconciliation of selected U.S.

GAAP-based measures to adjusted measures for the three months and year ended February 28, 2025.

The following tables reconcile the Company’s segment gross margin results for the three months and year ended February 29, 2024 to consolidated U.S.

GAAP results:

For the Three Months Ended February 29, 2024

(in millions)

Secure Communications QNX Licensing Segment Totals Reconciling Items Consolidated U.S.

Revenue $ 71.6 $ 65.9 $ 15.4 $ 152.9 $ — $ 152.9

Cost of sales 18.9 9.7 1.4 30.0 0.7 30.7

Gross margin (1)

Segment revenue $ 268.0 $ 236.0 $ 32.0 $ 258.9 $ 272.6 $ (13.7) $ 22.2 $ 26.3 $ (4.1)

Segment cost of sales 45.4 38.8 6.6 77.2 92.7 (15.5) 6.1 6.1 —

Segment adjusted gross margin $ 222.6 $ 197.2 $ 25.4 $ 181.7 $ 179.9 $ 1.8 $ 16.1 $ 20.2 $ (4.1)

Segment research and development 61.7 59.3 2.4 45.8 43.8 2.0 — — —

Segment sales and marketing 56.2 46.4 9.8 51.0 46.4 4.6 — — —

Segment general and administrative 33.8 32.4 1.4 29.0 37.7 (8.7) 1.2 10.4 (9.2)

Less amortization included in segment cost of sales 0.1 — 0.1 0.2 0.3 (0.1) 6.1 6.0 0.1

Segment adjusted EBITDA (1)

$ 71.0 $ 59.1 $ 11.9 $ 56.1 $ 52.3 $ 3.8 $ 21.0 $ 15.8 $ 5.2

Operating expenses 134.7 134.7

Investment income, net 4.0 4.0

Loss before income taxes $ (8.5)

For the Year Ended February 29, 2024

For the Years Ended

(in millions)

Secure Communications QNX Licensing Segment Totals Reconciling Items Consolidated U.S.

Revenue $ 283.8 $ 215.4 $ 259.9 $ 759.1 $ — $ 759.1

Cost of sales 80.7 33.8 150.9 265.4 3.0 268.4

Gross margin (1)

QNX Secure Communications Licensing

Feb 28 Feb 29 Change Feb 28 Feb 29 Change Feb 28 Feb 29 Change

2025 2024 2025 2024 2025 2024

Operating expenses 479.7 479.7

Investment income, net 18.8 18.8

Income before income taxes $ 29.8

Segment revenue $ 236.0 $ 215.4 $ 20.6 $ 272.6 $ 283.8 $ (11.2) $ 26.3 $ 259.9 $ (233.6)

Segment cost of sales 38.8 33.8 5.0 92.7 80.7 12.0 6.1 150.9 (144.8)

Segment adjusted gross margin $ 197.2 $ 181.6 $ 15.6 $ 179.9 $ 203.1 $ (23.2) $ 20.2 $ 109.0 $ (88.8)

Segment research and development 59.3 63.8 (4.5) 43.8 55.6 (11.8) — — —

Segment sales and marketing 46.4 43.3 3.1 46.4 58.2 (11.8) — — —

Segment general and administrative 32.4 41.0 (8.6) 37.7 44.1 (6.4) 10.4 17.1 (6.7)

Less amortization included in segment cost of sales — — — 0.3 0.8 (0.5) 6.0 3.6 2.4

Segment adjusted EBITDA (1)

$ 59.1 $ 33.5 $ 25.6 $ 52.3 $ 46.0 $ 6.3 $ 15.8 $ 95.5 $ (79.7)

(1) See “Non-GAAP Financial Measures” for a reconciliation of selected U.S.

GAAP-based measures to adjusted measures for the three months and year ended February 29, 2024.

The following table reconciles total segment adjusted EBITDA for the three months and year ended February 28, 2025 and February 29, 2024 to the Company’s consolidated totals:

Three Months Ended For the Years Ended

February 28, 2025 February 29, 2024 February 28, 2025 February 29, 2024

Total Segment Adjusted EBITDA $ 33.2 $ 47.5 $ 127.2 $ 175.0

Adjustments (1) :

Stock compensation expense 4.3 4.8 20.6 28.8

Restructuring expenses 11.4 18.4 26.1 35.9

Corporate general and administrative expense 12.1 9.3 43.0 33.3

Amortization 5.7 6.4 24.3 31.3

Impairment of long-lived assets 4.9 4.7 9.6 15.3

Impairment of goodwill — 15.9 — 15.9

Prior Debentures fair value adjustment — 0.5 — 3.5

Litigation settlement 2.8 — 2.8 —

Investment income (1.6) (4.0) (7.7) (18.8)

Consolidated income (loss) from continuing operations before income taxes $ (6.4) $ (8.5) $ 8.5 $ 29.8

______________________________

(1) The CODM reviews segment information on an adjusted EBITDA basis, which excludes certain amounts as described below:

(1) The CODM also reviews segment information on an adjusted EBITDA basis, which excludes certain amounts as described below:

Restructuring charges - Restructuring charges relate to employee termination benefits, facilities, streamlining many of the Company’s centralized corporate functions into QNX and Secure Communications specific teams, and other costs pursuant to programs to reduce the Company’s annual expenses amongst R&D, infrastructure and other functions and do not reflect expected future operating expenses, are not indicative of the Company’s core operating performance, and may not be meaningful when comparing the Company’s operating performance against that of prior periods.

Stock compensation expenses - Equity compensation is a non-cash expense and does not impact the ongoing operating decisions taken by the Company’s management.

Restructuring expenses - Restructuring costs relate to employee termination benefits, facilities, streamlining many of the Company’s centralized corporate functions into Secure Communications (formerly “Cybersecurity”) and QNX (formerly “IoT”) specific teams, and other costs pursuant to programs to reduce the Company’s annual expenses amongst R&D, infrastructure and other functions do not reflect expected future operating expenses, are not indicative of the Company’s core operating performance, and may not be meaningful when comparing the Company’s operating performance against that of prior periods.

Long-lived asset impairment charge - Long-lived asset impairment charges do not reflect expected future operating expenses, are not indicative of the Company’s core operating performance, and may not be meaningful when comparing the Company’s operating performance against that of prior periods.

Financial Highlights

The Company had approximately $432.4 million in cash, cash equivalents and investments as of February 28, 2026 (Fiscal 2025 - $410.3 million).

In fiscal 2025, the Company recognized revenue of $534.9 million and incurred a net loss of $79.0 million, or 0.13 basic and diluted loss per share on a U.S.

GAAP basis (fiscal 2024 - revenue of $759.1 million and net loss of $130.2, or 0.22 basic loss and diluted loss per share).

The Company recognized net loss from continuing operations of $8.5 million, or $0.01 basic and diluted loss per share on a U.S.

GAAP basis for fiscal 2025 (fiscal 2024 - net income from continuing operations of $5.6 million, or $0.01 basic and diluted earnings per share).

In fiscal 2026, the Company recognized revenue of $549.1 million and net income of $53.2 million, or $0.09 basic and diluted earnings per share on a U.S.

GAAP basis (fiscal 2025 - revenue of $534.9 million and net loss of $79.0 million, or $0.13 basic and diluted loss per share).

The Company recognized income from continuing operations of $53.2 million, or $0.09 basic and diluted earnings per share on a U.S.

GAAP basis for fiscal 2026 (fiscal 2025 - net loss from continuing operations of $8.5 million, or $0.01 basic and diluted loss per share).

The Company recognized adjusted net income of $97.3 million, or adjusted income of $0.16 per share, on a non-GAAP basis in fiscal 2026 (fiscal 2025 - adjusted net income of $12.5 million and adjusted income of $0.02 per share).

4 unchanged sentences

GAAP, and information contained in this MD&A is presented on that basis.

On April 2, 2025, the Company announced financial results for the three months and fiscal year ended February 28, 2025, which included certain non-GAAP financial measures and non-GAAP ratios, including adjusted gross margin, adjusted gross margin percentage, adjusted operating expense, adjusted income (loss) from continuing operations, adjusted net income (loss), adjusted earnings (loss) per share, adjusted research and development expense, adjusted sales and marketing expense, adjusted general and administrative expense, adjusted amortization expense, adjusted operating income (loss), adjusted EBITDA, adjusted EBITDA from continuing and discontinued operations, adjusted segment EBITDA, adjusted operating income (loss) margin percentage, adjusted EBITDA margin percentage and free cash flow (usage).

In the Company’s internal reports, management evaluates the performance of the Company’s business on a non-GAAP basis by excluding the impact of certain items from the Company’s U.S.

On April 9, 2026, the Company announced financial results for the three months and fiscal year ended February 28, 2026, which included certain non-GAAP financial measures and non-GAAP ratios, including adjusted gross margin, adjusted gross margin percentage, adjusted operating expenses, adjusted Corporate operating costs, adjusted Corporate operating costs excluding amortization , adjusted net income, adjusted earnings per share, adjusted research and development expense, adjusted sales and marketing expense, adjusted general and administrative expense, adjusted amortization expense, adjusted operating income, adjusted EBITDA, segment adjusted EBITDA, adjusted operating income margin percentage, adjusted EBITDA margin percentage and free cash flow (usage).

These non-GAAP financial measures and non-GAAP ratios do not have any standardized meaning as prescribed by U.S.

GAAP and are therefore unlikely to be comparable to similar measures presented by other companies.

In the Company’s internal reports, management evaluates the performance of the Company’s business on a non-GAAP basis by excluding the impact of certain items below from the Company’s U.S.

GAAP financial results.

The Company believes that these non-GAAP financial measures and non-GAAP ratios provide management, as well as readers of the Company’s financial statements, with a consistent basis for comparison across accounting periods and are useful in helping management and readers understand the Company’s operating results and underlying operational trends.

For purposes of comparability, the Company’s non-GAAP financial measures for the three months ended and years ended February 29, 2024 and February 28, 2023 have been updated to conform to the current year’s presentation and discontinued operations.

Non-GAAP financial measures and non-GAAP ratios exclude certain amounts as described below:

• Prior Debentures fair value adjustment .

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• Restructuring charges .

The Company believes that restructuring costs relating to employee termination benefits, facilities, streamlining many of the Company’s centralized corporate functions into Secure Communications (formerly “Cybersecurity”) and QNX (formerly “IoT”) specific teams, and other costs pursuant to programs to reduce the Company’s annual expenses amongst R&D, infrastructure and other functions do not reflect expected future operating expenses, are not indicative of the Company’s core operating performance, and may not be meaningful when comparing the Company’s operating performance against that of prior periods.

The Company believes that restructuring charges relating to employee termination benefits, exiting facilities, streamlining many of the Company’s centralized corporate functions into QNX and Secure Communications specific teams, and other costs pursuant to programs to reduce the Company’s annual expenses amongst R&D, infrastructure and other functions do not reflect expected future operating expenses, are not indicative of the Company’s core operating performance, and may not be meaningful when comparing the Company’s operating performance against that of prior periods.

• Stock compensation expenses .

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GAAP based measures for the three months ended February 28, 2026, February 28, 2025 and February 29, 2024

Readers are cautioned that adjusted gross margin, adjusted gross margin percentage, adjusted operating expense, adjusted income (loss) from continuing operations, adjusted net income (loss), adjusted earnings (loss) per share, adjusted research and development expense, adjusted sales and marketing expense, adjusted general and administrative expense, adjusted amortization expense, adjusted operating income (loss), adjusted EBITDA, adjusted EBITDA from continuing and discontinued operations, adjusted segment EBITDA, adjusted operating income (loss) margin percentage, adjusted EBITDA margin percentage and free cash flow (usage) and similar measures do not have any standardized meaning prescribed by U.S.

Readers are cautioned that adjusted gross margin, adjusted gross margin percentage, adjusted operating expenses, adjusted Corporate operating costs, adjusted Corporate operating costs excluding amortization , adjusted net income, adjusted earnings per share, adjusted research and development expense, adjusted sales and marketing expense, adjusted general and administrative expense, adjusted amortization expense, adjusted operating income, adjusted EBITDA, segment adjusted EBITDA, adjusted operating income margin percentage, adjusted EBITDA margin percentage and free cash flow (usage) and similar measures do not have any standardized meaning prescribed by U.S.

GAAP and are therefore unlikely to be comparable to similarly titled measures reported by other companies.

A reconciliation of the most directly comparable U.S.

GAAP financial measures for the three months ended February 28, 2025, February 29, 2024 and February 28, 2023 to adjusted financial measures is reflected in the table below:

GAAP gross margin and gross margin percentage for the three months ended February 28, 2026, February 28, 2025 and February 29, 2024 to both adjuste d gross margin and adjusted gross margin percentage are reflected in the table below:

For the Three Months Ended (in millions) February 28, 2026 February 28, 2025 February 29, 2024

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Reconciliation of U.S.

GAAP operating expense for the three months ended February 28, 2025, November 30, 2024, February 29, 2024 and February 28, 2023 to adjusted operating expense is reflected in the table below:

GAAP operating expenses for the three months ended February 28, 2026, November 30, 2025, February 28, 2025 and February 29, 2024 to adjusted operating expenses is reflected in the table below:

For the Three Months Ended (in millions) February 28, 2026 November 30, 2025 February 28, 2025 February 29, 2024

Operating expense $ 112.1 $ 92.7 $ 134.7 $ 191.0

Operating expenses $ 98.5 $ 98.0 $ 112.1 $ 134.7

Restructuring charges 3.3 6.1 11.4 18.4

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LLA impairment charge 0.9 0.6 4.9 4.7

Adjusted operating expense $ 87.4 $ 79.7 $ 89.3 $ 87.8

Adjusted operating expenses $ 89.4 $ 85.4 $ 87.4 $ 89.3

Reconciliation of U.S.

GAAP loss from continuing operations, U.S.

GAAP net income (loss) and U.S.

GAAP basic earnings (loss) per share for the three months ended February 28, 2025, February 29, 2024 and February 28, 2023 to adjusted income (loss) from continuing operations, adjusted net income (loss) and adjusted basic earnings (loss) per share is reflected in the table below:

For the Three Months Ended (in millions, except per share amounts) February 28, 2025 February 29, 2024 February 28, 2023

Basic earnings (loss)

per share Basic earnings (loss)

Loss from continuing operations $ (7.8) $(0.01) $ (12.4) $(0.02) $ (96.9) $(0.17)

GAAP Corporate operating costs for the three months ended February 28, 2026 and February 28, 2025 to adjusted Corporate operating costs excluding amortization is reflected in the table below:

For the Three Months Ended (in millions) February 28, 2026 February 28, 2025 February 29, 2024

Corporate operating costs

$ 17.6 $ 31.1 $ 50.5

Restructuring charges 3.3 11.4 18.4

Stock compensation expense 2.1 1.3 1.5

Prior Debentures fair value adjustment — 0.5 (25.4)

Acquired intangibles amortization 1.7 1.8 3.5

Litigation settlements — 2.8 —

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LLA impairment charge 0.9 2.9 4.7

Adjusted income from continuing operations $ 17.3 $0.03 $ 33.7 $0.06 $ 7.0 $0.01

Adjusted Corporate operating costs 11.3 12.7 10.0

Amortization 0.2 0.6 0.7

Adjusted Corporate operating costs excluding amortization $ 11.1 $ 12.1 $ 9.3

Reconciliation of U.S.

GAAP net income (loss) and U.S.

GAAP basic earnings (loss) per share for the three months ended February 28, 2026, February 28, 2025 and February 29, 2024 to adjusted net income and adjusted basic earnings per share is reflected in the table below:

For the Three Months Ended (in millions, except per share amounts) February 28, 2026 February 28, 2025 February 29, 2024

Basic earnings

per share Basic earnings (loss)

Net income (loss) $ 24.3 $0.04 $ (7.4) $(0.01) $ (56.2) $(0.10)

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LLA impairment charge 0.9 4.9 4.7

Adjusted net income (loss) $ 17.7 $0.03 $ 16.4 $0.03 $ (13.1) $(0.02)

Adjusted net income $ 34.0 $0.06 $ 17.7 $0.03 $ 16.4 $0.03

Reconciliation of U.S.

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Adjusted amortization expense $ 1.9 $ 2.4 $ 2.9

Reconciliation of U.S.

GAAP operating income (loss) to adjusted operating income, adjusted EBITDA, adjusted operating income margin percentage and adjusted EBITDA margin percentage for the three months ended February 28, 2026, February 28, 2025 and February 29, 2024 are reflected in the table below.

For the Three Months Ended (in millions) February 28, 2026 February 28, 2025 February 29, 2024

Operating income (loss) $ 22.9 $ (8.0) $ (12.5)

Non-GAAP adjustments to operating income (loss)

Restructuring charges 3.3 11.4 18.4

Stock compensation expense 5.5 4.3 4.8

Prior Debentures fair value adjustment — — 0.5

Acquired intangibles amortization — 1.7 1.8

Litigation settlements — 2.8 —

Goodwill impairment charge — — 15.9

LLA impairment charge 0.9 4.9 4.7

Total non-GAAP adjustments to operating income 9.7 25.1 46.1

Adjusted operating income 32.6 17.1 33.6

Amortization 3.5 5.7 6.4

Acquired intangibles amortization — (1.7) (1.8)

Adjusted EBITDA $ 36.1 $ 21.1 $ 38.2

Revenue $ 156.0 $ 141.7 $ 152.9

Adjusted operating income margin % (1)

Adjusted EBITDA margin % (2)

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(1) Adjusted operating income margin % is calculated by dividing adjusted operating income by revenue.

(2) Adjusted EBITDA margin % is calculated by dividing adjusted EBITDA by revenue.

The CODM also uses the segment metric of segment adjusted EBITDA, which is a non-GAAP measure including segment expenses that exclude amounts related to investment income, taxes, amortization, stock compensation expenses, long-lived asset impairment and restructuring charges.

The following table reconciles the U.S.

GAAP measures of segment profit or loss disclosed by the Company in the Consolidated Financial Statements of segment adjusted gross margin to segment adjusted EBITDA for the three months ended February 28, 2026, February 28, 2025 and February 29, 2024.

For the Three Months Ended

(in millions)

QNX Secure Communications Licensing

February 28, Feb 29 February 28, Feb 29 February 28, Feb 29

2026 2025 2024 2026 2025 2024 2026 2025 2024

Segment adjusted gross margin $ 66.5 $ 54.7 $ 56.2 $ 52.2 $ 42.8 $ 52.7 $ 3.3 $ 7.0 $ 14.0

Segment research and development 19.6 12.9 15.8 12.3 9.0 11.5 — — —

Segment sales and marketing 17.0 14.4 12.3 12.9 12.0 13.4 — — —

Segment general and administrative 8.5 8.2 10.4 7.5 9.2 10.9 (1.5) 7.1 2.7

Less amortization included in segment cost of sales — — — — — 0.2 1.5 1.5 1.4

Segment adjusted EBITDA $ 21.4 $ 19.2 $ 17.7 $ 19.5 $ 12.6 $ 17.1 $ 6.3 $ 1.4 $ 12.7

Reconciliation of non-GAAP based measures with most directly comparable U.S.

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A reconciliation of the most directly comparable U.S.

GAAP financial measures for the years ended February 28, 2025, February 29, 2024 and February 28, 2023 to adjusted financial measures is reflected in the table below:

GAAP gross margin and gross margin percentage for the years ended February 28, 2026, February 28, 2025 and February 29, 2024 to both adjuste d gross margin and adjusted gross margin percentage are reflected in the table below:

For the Fiscal Years Ended (in millions) February 28, 2026 February 28, 2025 February 29, 2024

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Adjusted gross margin % 76.6 % 74.3 % 65.0 %

Operating expense $ 394.1 $ 479.7 $ 573.4

Reconciliation of U.S.

GAAP operating expenses for the years ended February 28, 2026, February 28, 2025 and February 29, 2024 to adjuste d operating expenses is ref lected in the table below:

For the Fiscal Years Ended (in millions) February 28, 2026 February 28, 2025 February 29, 2024

Operating expenses $ 369.9 $ 394.1 $ 479.7

Restructuring charges 15.7 26.1 35.9

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LLA impairment charge 2.1 9.6 15.3

Adjusted operating expense $ 330.4 $ 372.3 $ 381.8

Adjusted operating expenses $ 328.0 $ 330.4 $ 372.3

Reconciliation of U.S.

GAAP income (loss) from continuing operations, U.S.

GAAP net income (loss) and U.S.

GAAP basic earnings (loss) per share for the years ended February 28, 2025, February 29, 2024 and February 28, 2023 to adjusted income (loss) from continuing operations, adjusted net income (loss) and adjusted basic earnings (loss) per share is reflected in the table below:

For the Fiscal Years Ended (in millions, except per share amounts) February 28, 2025 February 29, 2024 February 28, 2023

Basic earnings (loss) per share Basic earnings (loss) per share Basic loss per share

Income (loss) from continuing operations $ (8.5) $ (0.01) $ 5.6 $ 0.01 $ (215.5) $ (0.37)

GAAP Corporate operating costs for the years ended February 28, 2026, February 28, 2025 and February 29, 2024 to adjusted Corporate operating costs excluding amortization is reflected in the table below:

For the Fiscal Years Ended (in millions) February 28, 2026 February 28, 2025 February 29, 2024

Corporate operating costs

$ 68.1 $ 86.4 $ 118.1

Restructuring charges 15.7 26.0 35.9

Stock compensation expense 8.2 4.3 14.4

Prior Debentures fair value adjustment — 3.5 (137.4)

Acquired intangibles amortization 7.0 11.0 13.8

Litigation settlements — 2.8 —

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LLA impairment charge 2.1 7.5 15.3

Adjusted income (loss) from continuing operations $ 57.6 $0.10 $ 116.0 $0.20 $ (20.9) $(0.04)

Net loss $ (79.0) $(0.13) $ (130.2) $(0.22) $ (734.4) $(1.27)

Adjusted Corporate operating costs 42.1 45.8 36.6

Amortization 1.1 2.8 3.1

Adjusted Corporate operating costs excluding amortization $ 41.0 $43.0 $33.5

Reconciliation of U.S.

GAAP net income (loss) and U.S.

GAAP basic earnings (loss) per share for the years ended February 28, 2026, February 28, 2025 and February 29, 2024 to adjusted net income and adjusted basic earnings per share is reflected in the table below:

For the Fiscal Years Ended (in millions, except per share amounts) February 28, 2026 February 28, 2025 February 29, 2024

Basic earnings per share Basic earnings (loss) per share Basic loss per share

Net income (loss) $ 53.2 $0.09 $ (79.0) $(0.13) $ (130.2) $(0.22)

Restructuring charges 15.7 26.1 35.9

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LLA impairment charge 2.1 9.6 15.3

Adjusted net income (loss) $ 12.5 $0.02 $ 30.6 $0.05 $ (103.3) $(0.17)

Adjusted net income $ 97.3 $0.16 $ 12.5 $0.02 $ 30.6 $0.05

Reconciliation of U.S GAAP research and development, sales and marketing, general and administrative, and amortization expense for the years ended February 28, 2026, February 28, 2025 and February 29, 2024 to adjusted research and development, sales and marketing, general and administrative, and amortization expense is reflected in the table below:

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Adjusted amortization expense $ 8.3 $ 10.7 $ 15.7

Adjusted operating income, adjusted EBITDA, adjusted operating income margin percentage and adjusted EBITDA margin percentage for the three months ended February 28, 2025, February 29, 2024 and February 28, 2023 are reflected in the table below.

For the Three Months Ended (in millions) February 28, 2025 February 29, 2024 February 28, 2023

Operating loss $ (8.0) $ (12.5) $ (101.2)

Non-GAAP adjustments to operating loss

Reconciliation of U.S.

GAAP operating income (loss) to adjusted operating income, adjusted EBITDA, adjusted operating income margin percentage and adjusted EBITDA margin percentage for the years ended February 28, 2026, February 28, 2025 and February 29, 2024 are reflected in the table below.

For the Fiscal Years Ended (in millions) February 28, 2026 February 28, 2025 February 29, 2024

Operating income $ 48.3 $ 0.8 $ 11.0

Non-GAAP adjustments to operating income

Restructuring charges 15.7 26.1 35.9

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LLA impairment charge 2.1 9.6 15.3

Total non-GAAP adjustments to operating loss 25.1 46.1 103.9

Total non-GAAP adjustments to operating income 44.1 66.1 110.4

Adjusted operating income 92.4 66.9 121.4

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Adjusted operating income margin % (1)

Adjusted EBITDA margin % (2)

17 % 13 % 16 %

(1) Adjusted operating income margin % is calculated by dividing adjusted operating income by revenue.

(2) Adjusted EBITDA margin % is calculated by dividing adjusted EBITDA by revenue.

Adjusted operating income (loss), adjusted EBITDA, adjusted operating income (loss) margin percentage and adjusted EBITDA margin percentage for the fiscal years ended February 28, 2025, February 29, 2024 and February 28, 2023 are reflected in the table below.

For the Fiscal Years Ended (in millions) February 28, 2025 February 29, 2024 February 28, 2023

Operating income (loss) $ 0.8 $ 11.0 $ (206.8)

Non-GAAP adjustments to operating income (loss)

Restructuring charges 26.1 35.9 10.2

Stock compensation expense 20.6 28.8 27.4

Prior Debentures fair value adjustment — 3.5 (137.4)

Acquired intangibles amortization 7.0 11.0 13.8

Litigation settlements 2.8 — 165.0

Goodwill impairment charge — 15.9 112.1

LLA impairment charge 9.6 15.3 3.5

Total non-GAAP adjustments to operating income (loss) 66.1 110.4 194.6

Adjusted operating income (loss) 66.9 121.4 (12.2)

Amortization 24.3 31.3 36.5

Acquired intangibles amortization (7.0) (11.0) (13.8)

Adjusted EBITDA $ 84.2 $ 141.7 $ 10.5

Revenue $ 534.9 $ 759.1 $ 526.3

Adjusted operating income (loss) margin % (1)

13 % 16 % (2 %)

Adjusted EBITDA margin % (2)

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(1) Adjusted operating income (loss) margin % is calculated by dividing adjusted operating income (loss) by revenue.

(1) Adjusted operating income margin % is calculated by dividing adjusted operating income by revenue.

(2) Adjusted EBITDA margin % is calculated by dividing adjusted EBITDA by revenue.

Adjusted EBITDA from continuing and discontinued operations for the fiscal years ended February 28, 2025, February 29, 2024 and February 28, 2023 are reflected in the table below.

For the Fiscal Years Ended (in millions) February 28, 2025 February 29, 2024 February 28, 2023

Net loss $ (79.0) $ (130.2) $ (734.4)

Non-GAAP adjustments to operating loss

Restructuring charges 26.1 35.9 10.2

Stock compensation expense 25.6 33.1 31.4

Prior Debentures fair value adjustment

The following table reconciles the U.S.

GAAP measures of segment profit or loss disclosed by the Company in the Consolidated Financial Statements of segment adjusted gross margin to segment adjusted EBITDA for the years ended February 28, 2026, February 28, 2025 and February 29, 2024.

For the Years Ended

(in millions)

QNX Secure Communications Licensing

February 28, Feb 29, February 28, Feb 29, February 28, Feb 29,

2026 2025 2024 2026 2025 2024 2026 2025 2024

Acquired intangibles amortization 27.4 38.2 82.0

Litigation settlements 2.8 — 165.0

Goodwill impairment charge — 34.8 245.4

LLA impairment charge 9.6 15.3 234.5

Total non-GAAP adjustments to net loss 91.5 160.8 631.1

Adjusted operating income (loss) 12.5 30.6 (103.3)

Amortization 44.7 58.5 104.7

Acquired intangibles amortization (27.4) (38.2) (82.0)

Investment income, net (7.7) (18.8) (5.0)

Provision for income taxes from continuing and discontinued operations 17.2 24.2 13.7

Adjusted EBITDA from continuing and discontinued operations $ 39.3 $ 56.3 $ (71.9)

Segment adjusted gross margin $ 222.6 $ 197.2 $ 181.6 $ 181.7 $ 179.9 $ 203.1 $ 16.1 $ 20.2 $ 109.0

Segment research and development 61.7 59.3 63.8 45.8 43.8 55.6 — — —

Segment sales and marketing 56.2 46.4 43.3 51.0 46.4 58.2 — — —

Segment general and administrative 33.8 32.4 41.0 29.0 37.7 44.1 1.2 10.4 17.1

Less amortization included in segment cost of sales 0.1 — — 0.2 0.3 0.8 6.1 6.0 3.6

Segment adjusted EBITDA $ 71.0 $ 59.1 $ 33.5 $ 56.1 $ 52.3 $ 46.0 $ 21.0 $ 15.8 $ 95.5

Free cash flow (usage)

The Company uses free cash flow (usage) when assessing its sources of liquidity, capital resources, and quality of earnings.

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Reconciliation of U.S.

GAAP net cash provided by (used in) operating activities for the three months ended February 28, 2025, February 29, 2024 and February 28, 2023 to free cash flow (usage) is reflected in the table below:

GAAP net cash provided by (used in) operating activities for the three months and years ended February 28, 2026, February 28, 2025 and February 29, 2024 to free cash flow (usage) is reflected in the table below:

For the Three Months Ended (in millions) February 28, 2026 February 28, 2025 February 29, 2024

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Free cash flow (usage) $ 44.4 $ 41.5 $ (16.3)

Reconciliation of U.S.

GAAP net cash provided by (used in) operating activities for the years ended February 28, 2025, February 29, 2024 and February 28, 2023 to free cash flow (usage) is reflected in the table below:

For the Fiscal Years Ended (in millions) February 28, 2026 February 28, 2025 February 29, 2024

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Free cash flow (usage) $ 46.5 $ 13.4 $ (10.6)

For the year ended February 28, 2023, free cash usage includes $165.0 million paid in relation to a legal settlement.

The Company regularly monitors a number of financial and operating metrics, including the following key metrics, in order to measure the Company’s current performance and estimated future performance.

Readers are cautioned that Secure Communications annual recurring revenue (“ARR”), Secure Communications dollar-based net retention rate (“DBNRR”) and QNX royalty backlog do not have any standardized meaning and are unlikely to be comparable to similarly titled measures reported by other companies.

Comparative breakdowns of certain key metrics for the three months ended February 28, 2025 and February 29, 2024 are set forth below.

Comparative breakdowns of certain key metrics for the three months ended or as at February 28, 2026 and February 28, 2025 are set forth below.

For the Three Months Ended (in millions) February 28, 2026 February 28, 2025 Change

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The Company uses ARR as an indicator of business momentum for the Secure Communications business.

Secure Communications ARR was approximately $208 million in the fourth quarter of fiscal 2025 and decreased compared to $215 million in the third quarter of fiscal 2025 and increased compared to $202 million in the fourth quarter of fiscal 2024 primarily due to customer churn in the UEM business.

Secure Communications ARR was approximately $218 million in the fourth quarter of fiscal 2026 and increased compared to $216 million in the third quarter of fiscal 2026 and increased compared to $208 million in the fourth quarter of fiscal 2025.

Secure Communications Dollar-Based Net Retention Rate

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The Company uses DBNRR as an indicator of business momentum for the Secure Communications business.

Secure Communications DBNRR was 93% in the fourth quarter of fiscal 2025 and decreased compared to 95% in the third quarter of fiscal 2025 and increased compared to 91% in the fourth quarter of fiscal 2024.

Secure Communications DBNRR was 94% in the fourth quarter of fiscal 2026 and increased compared to 92% in the third quarter of fiscal 2025 and increased compared to 93% in the fourth quarter of fiscal 2025.

QNX Royalty Backlog

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Revenue by Segment

Secure Communications $ 272.6 $ 283.8 $ (11.2) $ 288.2 $ (4.4)

QNX $ 268.0 $ 236.0 $ 32.0 $ 215.4 $ 20.6

Secure Communications 258.9 272.6 (13.7) 283.8 (11.2)

Licensing 22.2 26.3 (4.1) 259.9 (233.6)

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% Revenue by Segment

Secure Communications 51.0 % 37.4 % 54.8 %

QNX 48.8 % 44.1 % 28.4 %

Secure Communications 47.2 % 51.0 % 37.4 %

Licensing 4.0 % 4.9 % 34.2 %

100.0 % 100.0 % 100.0 %

The increase in QNX revenue of $32.0 million was primarily due to an increase of $18.0 million in royalty revenue, an increase of $9.1 million in development seat revenue and an increase of $5.9 million in BlackBerry Radar revenue, partially offset by a decrease of $1.3 million in professional services.

The Company previously stated that it expected QNX revenue to be in the range of $260 million to $266 million for fiscal 2026 as a whole.

QNX revenue was $268 million for fiscal 2026.

The Company expects QNX revenue to be in the range of $60 million to $64 million in the first quarter of fiscal 2027, and for the full year to be in the range of $290 million to $307 million in fiscal 2027.

Secure Communications

The decrease in Secure Communications revenue of $11.2 million was primarily due to a decrease of $34.9 million relating to up-front components of revenue recognized in fiscal 2024 on the Company’s long term agreement with the Government of Malaysia and a decrease of $19.1 million in BlackBerry UEM product revenue, partially offset by an increase of $32.1 million relating to product revenue in Secusmart, an increase of $7.9 million increase in professional services revenue and an increase of $2.7 million in BlackBerry AtHoc.

The decrease in Secure Communications revenue of $13.7 million was primarily due to a decrease of $11.8 million in Secusmart product revenue, and a decrease of $5.2 million in BlackBerry UEM product revenue, partially offset by an increase of $3.5 million in BlackBerry AtHoc product revenue.

The Company previously stated that it expected Secure Communications revenue to be in the range of $247 million to $251 million for fiscal 2026 as a whole.

Secure Communications revenue was $272.6 million for fiscal 2025.

Secure Communications revenue for fiscal 2026 was $258.9 million due to higher than expected Secusmart product revenue in the fourth quarter of fiscal 2026.

The Company expects Secure Communications revenue to be in the range of $66 million to $70 million in the first quarter of fiscal 2027 and for the full year to be in the range of $270 million to $280 million in fiscal 2027.

The increase in QNX revenue of $20.6 million was primarily due to an increase of $22.1 million in BlackBerry QNX royalty revenue and an increase of $6.3 million in BlackBerry Radar revenue, partially offset by a decrease of $4.9 million in BlackBerry QNX development seat revenue and a decrease of $1.7 million in professional services.

The Company previously stated that it expected QNX revenue to be in the range of $230 million to $235 million for fiscal 2025 as a whole.

QNX revenue for fiscal 2025 was $236.0 million.

The Company expects QNX revenue to be in the range of $51 million to $55 million in the first quarter of fiscal 2026.

The Company previously stated that it expects QNX revenue to be in the range of $260 million to $270 million for fiscal 2026 as a whole.

The Company now expects QNX revenue to be in the range of $250 million to $270 million for fiscal 2026 as a whole due to the uncertain impact of new U.S.

tariffs and global retaliatory tariffs on QNX’s automotive customers.

The decrease in Licensing revenue of $233.6 million was primarily due to $217.7 million associated with the Company’s patent sale in the first quarter of fiscal 2024, which was a one time-event, and a decrease of $15.9 million in revenue from the Company’s other intellectual property licensing arrangements.

The decrease in Licensing revenue of $4.1 million was primarily due to a decrease in revenue from the Company’s intellectual property licensing arrangements.

The Company previously stated that it expected Licensing revenue to be approximately $24 million for fiscal 2026 as a whole.

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The Company previously stated that it expected total BlackBerry revenue to be in the range of $531 million to $541 million in fiscal 2026 as a whole.

Total BlackBerry revenue was $534.9 million and was higher due to the total impact of each of the Company’s operating segments exceeding the top end of the Company’s expectation ranges.

The Company expects total BlackBerry revenue to be approximately $107 million to $115 million in the first quarter of fiscal 2026, and for the full year to be in the range of $504 million to $534 million in fiscal 2026.

Total BlackBerry revenue was $549.1 million and was higher due to Secure Communications revenue exceeding previously provided guidance for the reasons described above.

The Company expects total BlackBerry revenue to be in the range of $132 million to $140 million in the first quarter of fiscal 2027 and for the full year to be in the range of $584 million to $611 million in fiscal 2027.

Revenue by Geography

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North America Revenue

The decrease in North America revenue of $248.2 million was primarily due to $217.7 million associated with the Company’s patent sale in the first quarter of fiscal 2024, which was a one time-event, a decrease of $17.6 BlackBerry UEM licensing revenue, a decrease of $15.9 million in revenue from the Company’s other intellectual property licensing arrangements and a decrease of $8.4 million in BlackBerry QNX development seat revenue, partially offset by an increase of $8.8 million in BlackBerry QNX royalty revenue and an increase of $5.8 million in BlackBerry Radar.

The decrease in North America revenue of $3.5 million was primarily due to a decrease of $11.6 million in BlackBerry UEM product revenue and a decrease of $4.5 million in Licensing revenue , partially offset by an increase of $5.8 million in BlackBerry Radar revenue, an increase of $3.2 million in BlackBerry AtHoc product revenue and an increase of $3.0 million in BlackBerry QNX royalty revenue.

Europe, Middle East and Africa Revenue

The increase in Europe, Middle East and Africa revenue of $29.6 million was primarily due to an increase of $32.0 million relating to product revenue in Secusmart and an increase of $3.2 million in BlackBerry QNX royalty revenue, partially offset by a decrease of $4.3 million in professional services revenue.

The increase in Europe, Middle East and Africa revenue of $5.1 million was primarily due to an increase of $6.9 million in BlackBerry QNX development seat revenue, an increase of $5.6 million in BlackBerry UEM product revenue and an increase of $2.8 million in BlackBerry QNX royalty revenue, partially offset by a decrease of $11.4 million in Secusmart product revenue.

Other Regions Revenue

The decrease in Other regions revenue of $5.6 million was primarily due to a decrease of $34.9 million relating to up-front components of revenue recognized in fiscal 2024 on the Company’s long term agreement with the Government of Malaysia, partially offset by an increase of $11.7 million professional services revenue, an increase of $10.2 million in BlackBerry QNX royalty revenue and an increase of $3.3 million in BlackBerry QNX development seat revenue.

The increase in Other regions revenue of $12.6 million was primarily due to an increase of $12.2 million in BlackBerry QNX royalty revenue.

Consolidated Gross Margin

Consolidated gross margin decreased by $95.8 million to approximately $394.9 million in fiscal 2025 (fiscal 2024 - $490.7 million).

The decrease was primarily due to the patent sale in the first quarter of fiscal 2024, which was a one-time event, and a lower gross margin from Secusmart due to change in product mix, partially offset by an increase in revenue from BlackBerry QNX due to the reasons discussed above in “Revenue by Segment”, as the cost of sales for most software and services products does not significantly fluctuate based on business volume.

Consolidated gross margin increased by $23.3 million to approximately $418.2 million in fiscal 2026 (fiscal 2025 - $394.9 million).

The increase was primarily due to an increase in revenue from QNX due to the reasons discussed above in “Revenue by Segment”.

Consolidated Gross Margin Percentage

Consolidated gross margin percentage increased by 2.4%, to approximately 76.2% of consolidated revenue in fiscal 2026 (fiscal 2025 - 73.8%).

The increase was primarily due to a change in mix specifically a lower gross margin contribution from Licensing, which had a lower relative gross margin percentage in fiscal 2024 due to the patent sale, and a higher gross margin contribution from BlackBerry QNX.

The increase was primarily due to a change in mix, specifically a higher relative gross margin contribution from Secusmart software licenses and QNX.

Gross Margin and Adjusted EBITDA by Segment

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(in millions)

Secure Communications QNX Licensing Segment Totals

Feb 28 Feb 29 Change Feb 28 Feb 29 Change Feb 28 Feb 29 Change Feb 28 Feb 29 Change

QNX Secure Communications Licensing

Feb 28 Feb 28 Change Feb 28 Feb 28 Change Feb 28 Feb 28 Change

2026 2025 2026 2025 2026 2025

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Segment cost of sales 45.4 38.8 6.6 77.2 92.7 (15.5) 6.1 6.1 —

Segment gross margin $ 179.9 $ 203.1 $ (23.2) $ 197.2 $ 181.6 $ 15.6 $ 20.2 $ 109.0 $ (88.8) $ 397.3 $ 493.7 $ (96.4)

Segment adjusted gross margin $ 222.6 $ 197.2 $ 25.4 $ 181.7 $ 179.9 $ 1.8 $ 16.1 $ 20.2 $ (4.1)

Segment adjusted gross margin % 83 % 84 % (1) % 70 % 66 % 4 % 73 % 77 % (4) %

Segment research and development 61.7 59.3 2.4 45.8 43.8 2.0 — — —

1 unchanged sentence

Segment general and administrative 33.8 32.4 1.4 29.0 37.7 (8.7) 1.2 10.4 (9.2)

Less amortization included in the above 3.2 4.4 (1.2) 2.3 2.9 (0.6) 9.0 9.7 (0.7) 14.5 17.0 (2.5)

Less amortization included in segment cost of sales 0.1 — 0.1 0.2 0.3 (0.1) 6.1 6.0 0.1

Segment adjusted EBITDA $ 71.0 $ 59.1 $ 11.9 $ 56.1 $ 52.3 $ 3.8 $ 21.0 $ 15.8 $ 5.2

The increase in QNX segment adjusted gross margin of $25.4 million was primarily due to the reasons discussed above in “Revenue by Segment”, partially offset by an increase in cost of sales related to BlackBerry Radar hardware devices.

The decrease in QNX segment adjusted gross margin percentage of 1% was primarily due to a change in mix, specifically an increased gross margin contribution from BlackBerry Radar which has a lower relative gross margin percentage.

The increase in QNX segment adjusted EBITDA of $11.9 million was primarily due to the reasons discussed above in “Revenue by Segment” and a benefit from the claims of Strategic Innovation Fund (SIF) grant funding, partially offset by an increase in cost of sales related to BlackBerry Radar hardware devices and an increase in salaries and benefits expense.

The Company does not expect to receive any further benefits from SIF claims.

The Company previously stated that it expected QNX segment adjusted EBITDA to be in the range of $67 million to $73 million in fiscal 2026.

QNX segment adjusted EBITDA was $71.0 million in fiscal 2026.

The Company expects QNX segment adjusted EBITDA to be in the range of $69 million to $81 million in fiscal 2027 and to be in the range of $4 million to $8 million in the first quarter of fiscal 2027.

Secure Communications

The decrease in Secure Communications gross margin of $23.2 million was primarily due to a change in mix, specifically a decrease in gross margin contribution from Secusmart software licenses, which had a higher relative gross margin percentage in fiscal 2024 due to up-front components of revenue recognized on the Company’s long-term agreement with the Government of Malaysia.

The decrease in Secure Communications gross margin percentage of 6% was primarily due to the same reasons discussed above.

The increase in Secure Communications adjusted EBITDA of $6.3 million was primarily due to decreases in salaries and benefits expense, partially offset by the reasons discussed above in “Revenue by Segment”.

The Company previously stated that it expected Secure Communications adjusted EBITDA to be in the range of $43 million to $45 million for fiscal 2025 as a whole.

Secure Communications adjusted EBITDA was $52.3 million for fiscal 2025 as a whole due to lower than expected salaries and benefits expense and revenue exceeding the top end of the Company’s expectation ranges.

The increase in Secure Communications segment adjusted gross margin of $1.8 million was due to a change in mix, specifically an increased gross margin contribution from Secusmart software licenses.

The increase in Secure Communications segment adjusted gross margin percentage of 4% was primarily due to the same reason discussed above.

The increase in Secure Communications segment adjusted EBITDA of $3.8 million was primarily due to an increase in segment adjusted gross margin percentage discussed above and a decrease in salaries and benefits expense, partially offset by a decrease in revenue due to the reasons discussed above in “Revenue by Segment”.

The Company previously stated that it expected Secure Communications segment adjusted EBITDA to be in the range of $47 million to $51 million for fiscal 2026 as a whole.

Secure Communications segment adjusted EBITDA was $56.1 million for fiscal 2026 as a whole due to Secure Communications revenue exceeding previously provided guidance for the reasons described above in “Revenue by Segment”.

The Company expects Secure Communications adjusted EBITDA to be in the range of $57 million to $65 million in fiscal 2027 and to be in the range of $14 million to $18 million in the first quarter of fiscal 2027.

The increase in QNX gross margin of $15.6 million was primarily due to the reasons discussed above in “Revenue by Segment”, partially offset by an increase in cost of sales related to Radar hardware devices.

QNX gross margin percentage of 84% was consistent with fiscal 2024.

The increase in QNX adjusted EBITDA of $25.6 million was primarily due to the reasons discussed above in “Revenue by Segment”, a decrease in facilities costs, a decrease in consulting costs and a benefit from claims filed with the Ministry of Innovation, Science and Economic Development Canada relating to its Strategic Innovation Fund (“SIF”) program’s investment in BlackBerry QNX.

The Company previously stated that it expected QNX adjusted EBITDA to be in the range of $48 million to $50 million in fiscal 2025.

QNX adjusted EBITDA was $59.1 million in fiscal 2025 due to SIF claims, lower than expected salaries and benefits expense, lower cost of sales due to product mix and revenue exceeding the top end of the Company’s expectation ranges.

The Company previously stated that it expected QNX adjusted EBITDA margin percentage to be approximately 18% in fiscal 2025.

QNX adjusted EBITDA margin percentage was 25% due to the reasons noted above.

The Company expects QNX adjusted EBITDA to be in the range of $55 million to $60 million in fiscal 2026 and to be in the range of $2 million to $6 million in the first quarter of fiscal 2026.

The decrease in Licensing gross margin of $88.8 million was primarily due to the patent sale in the first quarter of fiscal 2024, which had a lower relative gross margin percentage due to the cost basis of the sold assets which was de-recognized.

The increase in Licensing gross margin percentage of 35% was primarily due to the same reason discussed above.

The decrease in Licensing adjusted EBITDA of $79.7 million was primarily due to the same reason discussed above and an increase in credit loss provision that was subsequently written off, partially offset by a decrease in legal expense.

The Company previously stated that it expected Licensing adjusted EBITDA to be approximately $16 million in fiscal 2025.

Licensing adjusted EBITDA was $15.8 million in fiscal 2025.

The Company previously stated that it expected Licensing adjusted EBITDA margin percentage to be approximately 65% in fiscal 2025.

Licensing adjusted EBITDA was 60% in fiscal 2025 due to the reasons noted above.

The Company expects Licensing adjusted EBITDA to be approximately $20 million in fiscal 2026 and to be approximately $5 million in each of the four quarters of fiscal 2026.

The Company previously stated that it expected the negative impact to adjusted EBITDA from its Corporate functions to be approximately $48 million in fiscal 2025.

The negative impact to adjusted EBITDA from the Corporate functions was $43.0 million in fiscal 2025 and $12.1 million in the fourth quarter of fiscal 2025.

The decrease in Licensing segment adjusted gross margin of $4.1 million was primarily due to the reasons discussed above in “Revenue by Segment”.

The decrease in Licensing segment adjusted gross margin percentage of 4% was primarily due to the same reason discussed above.

The increase in Licensing segment adjusted EBITDA of $5.2 million was primarily due to a recovery of expected credit losses and a decrease in legal expense, partially offset by a decrease in revenue due to the reasons discussed above in “Revenue by Segment”.

The Company previously stated that it expected Licensing segment adjusted EBITDA to be approximately $20 million in fiscal 2026.

Licensing segment adjusted EBITDA was $21 million in fiscal 2026.

The Company expects Licensing segment adjusted EBITDA to be approximately $20 million in fiscal 2027 and to be approximately $5 million in each of the four quarters of fiscal 2027.

Operating Expenses

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Impairment of long-lived assets 2.1 9.6 (7.5) 15.3 (5.7)

Gain on sale of property, plant and equipment, net — — — (6.0) 6.0

Debentures fair value adjustment — — — 3.5 (3.5)

8 unchanged sentences

Impairment of long-lived assets 0.4 % 1.8 % 2.0 %

Gain on sale of property, plant and equipment, net — % — % (1.1 %)

Debentures fair value adjustment — % — % 0.5 %

5 unchanged sentences

Operating expenses decreased by $24.2 million, or 6.1% in fiscal 2026 compared to fiscal 2025.

The decrease was primarily due to a decrease of $34.9 million in salaries and benefits, a decrease of $15.9 million in goodwill impairment, a decrease of $9.9 million in facilities costs, a decrease of $9.8 million in restructuring costs, a decrease of $9.0 million in amortization expense, a decrease of $8.9 million in legal expenses, a decrease of $8.7 million in consulting cost, a decrease of $7.6 million in stock compensation expense and a decrease of $5.7 million in impairment of long-lived assets, partially offset by an increase of $19.1 million related to the release of an accrued liability relating to the Company’s legacy mobile device business in fiscal 2024 which did not recur and an increase of $10.8 million in variable incentive plan cost, and an increase of $5.3 million in the Company’s deferred share unit costs.

The decrease was primarily due to a decrease of $10.4 million in restructuring cost s, a recovery of $7.9 million of previously recognized credit losses, a decrease of $7.5 million in impairment of long-lived assets, a decrease of $6.3 million in amortization expense, a decrease of $5.3 million in the Company’s deferred share unit costs and an increase in benefits of $5.2 million from SIF claims filed, partially offset by an increase of $8.7 million in salaries and benefits expense and an increase of $7.6 million in variable incentive plan costs.

Adjusted Operating Expenses

Adjusted operating expenses decreased by $2.4 million, or 0.7%, to $328 million in fiscal 2026, compared to $330.4 million in fiscal 2025.

The decrease was primarily attributable to a decrease of $34.9 million in salaries and benefits, a decrease of $11.7 million in legal expenses, a decrease of $9.9 million in facilities costs, a decrease of $8.9 million in amortization expense and a decrease of $8.7 million in consulting cost, partially offset by an increase of $19.1 million related to the release of an accrued liability relating to the Company’s legacy mobile device business in fiscal 2024 which did not recur, an increase of $10.8 million in variable incentive plan cost, an increase of $5.3 million in the Company’s deferred share unit costs.

The decrease was primarily attributable to a recovery of $7.9 million of previously recognized credit losses , a decrease of $6.3 million in amortization expense, and a decrease of $5.3 million in the Company’s deferred share unit costs, partially offset by an increase of $8.7 million in salaries and benefits expense and an increase of $7.6 million in variable incentive plan costs.

Research and Development Expenses

Research and development expenses consist primarily of salaries and benefits for technical personnel, new product development costs, travel, office and building costs, infrastructure costs and other employee costs.

Research and development expenses decreased by $18.3 million, or 14.4% in fiscal 2025 compared to fiscal 2024.

The decrease was primarily attributable to a decrease of $9.4 million in salaries and benefits expenses, a decrease of $7.1 million in consulting cost, and an increase in benefits of $3.0 million from SIF claims filed.

Adjusted research and development expenses decreased by $16.3 million, or 13.6%, to $103.5 million in fiscal 2025 compared to $119.8 million in fiscal 2024.

The decrease was primarily due to the same reasons described above on a U.S.

Research and development expenses increased by $4.8 million, or 4.4% in fiscal 2026 compared to fiscal 2025.

The increase was primarily attributable to an increase of $4.5 million in salaries and benefits expense, an increase of $3.8 million in variable incentive plan costs and an increase of $2.0 million in consulting costs, partially offset by an increase in benefits of $5.2 million from SIF claims filed.

Adjusted research and development expenses increased by $4.7 million, or 4.5%, to $108.2 million in fiscal 2026 compared to $103.5 million in fiscal 2025.

The increase was primarily due to the same reasons described above on a U.S.

Sales and Marketing Expenses

Sales and marketing expenses consist primarily of marketing, advertising and promotion, salaries and benefits, information technology costs and travel expenses.

Sales and marketing expenses decreased by $8.5 million, or 8.2% in fiscal 2025 compared to fiscal 2024.

The decrease was primarily due to a decrease of $8.1 million in salaries and benefits and a decrease of $2.5 million in sales incentive plan costs.

Adjusted sales and marketing expenses decreased by $8.8 million, or 8.7%, to $92.7 million in fiscal 2025 compared to $101.5 million in fiscal 2024.

The decrease was primarily due to same reasons described above on a U.S.

Sales and marketing expenses increased by $18.5 million, or 19.4% in fiscal 2026 compared to fiscal 2025.

The increase was primarily due to an increase of $9.4 million in salaries and benefits expense, an increase of $2.6 million in sales incentive plan costs, an increase of $2.4 million in stock-based compensation expense, an increase of $1.9 million in variable incentive plan costs and an increase of $0.8 million in infrastructure costs.

Adjusted sales and marketing expenses increased by $16.2 million, or 17.5%, to $108.9 million in fiscal 2026 compared to $92.7 million in fiscal 2025.

The increase was primarily due to an increase of $9.4 million in salaries and benefits expense, an increase of $2.6 million in sales incentive plan costs, an increase of $1.9 million in variable incentive plan costs and an increase of $0.8 million in infrastructure costs.

General and Administrative Expenses

1 unchanged sentence

General and administrative expenses decreased by $30.9 million, or 19.3%, in fiscal 2026 compared to fiscal 2025.

The decrease was primarily due to a decrease of $17.4 million in salaries and benefits expenses, a decrease of $9.9 million in facilities cost, a decrease of $9.8 million in restructuring costs, a decrease of $8.6 million in legal expenses and a decrease of $5.9 million in stock based compensation expense, partially offset by an increase of $19.1 million related to the release of an accrued liability relating to the Company’s legacy mobile device business in fiscal 2024 which did not recur and an increase of $5.3 million in the Company’s deferred share unit cost.

The decrease was primarily due to a decrease of $10.4 million in restructuring costs, a recovery of $7.9 million of previously recognized credit losses , a decrease of $5.3 million in the Company’s deferred share unit costs and a decrease of $5.3 million in salaries and benefits expense.

Adjusted general and administrative expenses decreased by $20.9 million, or 16.9%, to $102.6 million in fiscal 2026 compared to $123.5 million in fiscal 2025.

The decrease was primarily due to a decrease of $17.4 million in salaries and benefits expenses, a decrease of $11.3 million in legal expenses, and a decrease $9.9 million in facilities costs, partially offset an increase of $19.1 million related to the release of an accrued liability relating to the Company’s legacy mobile device business in fiscal 2024 which did not recur and an increase of $5.3 million in the Company’s deferred unit share cost.

The Company expects adjusted Corporate general and administrative costs to be approximately $10 million in the first quarter of fiscal 2026 and approximately $40 million in fiscal 2026 as a whole.

The decrease was primarily due t o a recovery of $7.9 million of previously recognized credit losses, a decrease of $5.3 million in the Company’s deferred share unit cost and a decrease of $5.3 million in salaries and benefits expense.

Adjusted Corporate operating costs is defined as the portion of the Company’s total adjusted operating costs that is not attributable to any of the three operating segments.

The Company previously stated that it expected adjusted Corporate operating costs excluding amortization to be approximately $10 million in the fourth quarter of fiscal 2026.

Adjusted Corporate operating costs excluding amortization were $11.1 million in the fourth quarter of fiscal 2026.

The Company expects adjusted Corporate operating costs excluding amortization to be approximately $36 million in fiscal 2027 as a whole.

Amortization Expense

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Amortization included in Cost of Sales

The increase in amortization expense relating to certain property, plant and equipment and certain intangible assets employed in the Company’s service operations of $2.0 million was due to an increase in patent amortization expense included in cost of sales.

The decrease in amortization expense relating to certain property, plant and equipment and certain intangible assets employed in the Company’s service operations of $0.1 million was due to a lower cost base of assets.

Investment Income, Net

Investment income, net, which includes the interest expense from the Debentures, decreased by $11.1 million to investment income, net of $7.7 million in fiscal 2025 compared to investment income, net of $18.8 million in fiscal 2024.

The decrease in investment income, net was primarily due to a lower yield on cash and investments and the impact of observable price changes on non-marketable equity investments without readily determinable fair value.

Investment income, net, which includes the interest expense from the Debentures, increased by $3.0 million to investment income, net of $10.7 million in fiscal 2026 compared to investment income, net of $7.7 million in fiscal 2025.

The increase in investment income, net was primarily due to net unrealized losses recognized from observable price changes on non-marketable equity investments without readily determinable fair value in fiscal 2025 which did not recur and a higher return on cash and investments due to a higher cash and investments balance, partially offset by interest income on a delayed tax refund in fiscal 2025 which did not recur.

For fiscal 2026, the Company’s net effective income tax expense rate was approximately 10% ( fiscal 2025 - net effective income tax expense rate of approximately 27%).

1 unchanged sentence

The Company’s net effective income tax rate also reflects the geographic mix of earnings in jurisdictions with different income tax rates.

Net Loss From Continuing Operations

The Company’s loss from continuing operations for fiscal 2025 was $8.5 million, or $0.01 basic and diluted loss per share from continuing operations on a U.S.

GAAP basis (fiscal 2024 - income from continuing operations of $5.6 million, or $0.01 basic and diluted earnings per share from continuing operations).

The decrease in income of $14.1 million from continuing operations was primarily due to a decrease in revenue as described above in “Revenue by Segment”, partially offset by a decrease in operating expenses, as described above in “Operating Expenses” and an increase in gross margin percentage, as described above in “Consolidated Gross Margin Percentage”.

Adjusted income from continuing operations was $57.6 million in fiscal 2025 or $0.10 adjusted basic earnings per share from continuing operations (fiscal 2024 - adjusted income from continuing operations of $116.0 million, or $0.20 adjusted basic earnings per share from continuing operations).

The decrease in adjusted income from continuing operations of $58.4 million was primarily due to the same reasons described above on a U.S.

The Company’s net loss for fiscal 2025 was $79.0 million, or $0.13 basic and diluted loss per share on a U.S.

Net Income (loss)

The Company’s net income for fiscal 2026 was $53.2 million, or $0.09 basic and diluted earnings per share on a U.S.

GAAP basis (fiscal 2025 - net loss of $79.0 million, or $0.13 basic and diluted loss per share ).

The decrease in net loss of $51.2 million was primarily due to a decrease in loss from discontinued operations, a decrease in operating expenses, as described above in “Operating Expenses” and an increase in gross margin percentage, as described above in “Consolidated Gross Margin Percentage”, partially offset by a decrease in revenue as described above in “Revenue by Segment”.

The year over year change of $132.2 million was primarily due to a loss from discontinued operations in the fiscal 2025 which did not recur, a decrease in operating expenses, as described above in “Operating Expenses”, an increase in gross margin percentage, as described above in “Consolidated Gross Margin Percentage” and an increase in revenue as described above in “Revenue by Segment”.

Adjusted net income was $97.3 million in fiscal 2026 or $0.16 adjusted basic earnings per share (fiscal 2025 - adjusted net income of $12.5 million, or $0.02 adjusted basic earnings per share).

The decrease in adjusted net income of $18.1 million was primarily due to the same reasons described above on a U.S.

The Company previously stated that it expected total Company adjusted EBITDA from continuing operations to be in the range of $60 million to $70 million in fiscal 2025 and total Company adjusted EBITDA from continuing operations to be in the range of $10 million to $20 million in the fourth quarter of fiscal 2025.

Total Company adjusted EBITDA from continuing operations was $84.2 million fiscal 2025 due to each of the Company’s operating segments exceeding the top end of the Company’s expectation ranges and lower than expected salaries and benefits expense.

Total Company adjusted EBITDA from continuing operations was $21.1 million in the fourth quarter of fiscal 2025.

The Company previously stated that it expected non-GAAP EPS to be in the range of ($0.01) and $0.01 in the fourth quarter of fiscal 2025 and non-GAAP EPS to be in the range of ($0.02) to breakeven for fiscal 2025.

The increase in adjusted net income of $84.8 million was primarily due to the same reasons described above on a U.S.

The Company previously stated that it expected total Company adjusted EBITDA to be in the range of $94 million to $104 million in fiscal 2026 and total Company adjusted EBITDA to be in the range of $22 million to $32 million in the fourth quarter of fiscal 2026.

Total Company adjusted EBITDA was $107.1 million in fiscal 2026 due to Secure Communications revenue exceeding previously provided guidance for the reasons described above in “Revenue by Segment”.

Total Company adjusted EBITDA was $36.1 million in the fourth quarter of fiscal 2026 due to the same reason described above for fiscal 2026.

The Company previously stated that it expected non-GAAP EPS to be in the range of $0.03 and $0.05 in the fourth quarter of fiscal 2026 and non-GAAP EPS to be in the range of $0.14 to $0.16 for fiscal 2026.

Non-GAAP EPS was $0.06 in the fourth quarter of fiscal 2026 and $0.16 for fiscal 2026.

The Company expects adjusted EBITDA to be in the range of break-even to $7 million in the first quarter of fiscal 2026 and to be in the range of $69 million to $84 million in fiscal 2026 as a whole.

The Company expects non-GAAP EPS to be in the range of ($0.01) to breakeven in the first quarter of fiscal 2026 and to be in the range of $0.08 to $0.10 in fiscal 2026 as a whole.

The Company expects operating cash usage to be in the range of $20 million to $30 million in the first quarter of fiscal 2026 and to deliver positive operating cash flow of approximately $35 million for fiscal 2026.

The Company expects adjusted EBITDA to be in the range of $14 million to $22 million in the first quarter of fiscal 2027 and to be in the range of $110 million to $130 million in fiscal 2027 as a whole.

The Company expects non-GAAP EPS to be in the range of $0.02 to $0.03 in the first quarter of fiscal 2027 and to be in the range of $0.15 to $0.19 in fiscal 2027 as a whole.

The Company expects operating cash flow to be in the range of breakeven to $10 million in the first quarter of fiscal 2027 and to be approximately $100 million for fiscal 2027.

The Company does not provide a reconciliation of expected adjusted EBITDA and expected non-GAAP basic EPS for the first quarter and full fiscal year 2027 to the most directly comparable expected GAAP measures because it is unable to predict with reasonable certainty, among other things, restructuring charges and impairment charges and, accordingly, a reconciliation is not available without unreasonable effort.

These items are uncertain, depend on various factors, and could have a material impact on GAAP reported results for the guidance period.

The weighted average number of shares outstanding was 592 million common shares for basic earnings per share and 598 million common shares for diluted earnings per share for the fiscal year ended February 28, 2026.

The weighted average number of shares outstanding was 591 million common shares for basic and diluted loss per share for the fiscal year ended February 28, 2025.

The weighted average number of shares outstanding was 585 million common shares for basic loss per share and 592 million common shares for diluted loss per share for the fiscal year ended February 29, 2024.

Common Shares Outstanding

On March 28, 2025, there were 596 million voting common shares, options to purchase 0.1 million voting common shares, 11 million restricted share units and 1.6 million deferred share units outstanding.

On April 6, 2026, there were 588 million voting common shares, 14 million restricted share units and 1.8 million deferred share units outstanding.

In addition, 51.5 million common shares are issuable upon conversion in full of the Notes (as defined below), as described in Note 7 to the Consolidated Financial Statements.

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Revenue by Segment

Secure Communications $ 67.3 $ 71.6 $ (4.3) $ 60.8 $ 10.8

QNX $ 78.7 $ 65.8 $ 12.9 $ 65.9 $ (0.1)

Secure Communications 72.5 67.3 5.2 71.6 (4.3)

Licensing 4.8 8.6 (3.8) 15.4 (6.8)

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% Revenue by Segment

Secure Communications 47.5 % 46.8 % 49.2 %

QNX 50.4 % 46.4 % 43.1 %

Secure Communications 46.5 % 47.5 % 46.8 %

Licensing 3.1 % 6.1 % 10.1 %

100.0 % 100.0 % 100.0 %

Secure Communications

The decrease in Secure Communications revenue of $4.3 million was primarily due to a decrease of $11.9 million relating to BlackBerry UEM product revenue, partially offset by an increase of $2.9 million in professional services revenue, an increase of $2.1 million relating to product revenue in Secusmart and an increase of $0.9 million in BlackBerry AtHoc.

The Company previously stated that it expected Secure Communications revenue in the fourth quarter of fiscal 2025 to be in the range of $62 million to $66 million.

Secure Communications revenue in the fourth quarter of fiscal 2025 was $67.3 million.

QNX revenue in the fourth quarter of fiscal 2025 was consistent with the revenue in the fourth quarter of fiscal 2024.

The increase of $1.9 million in BlackBerry QNX royalty revenue and the increase of $2.1 million in BlackBerry Radar was offset by a decrease of $2.7 million in BlackBerry QNX development seat revenue and $1.3 million in professional services revenue.

The increase in QNX revenue of $12.9 million was primarily due to an increase of $10.0 million in royalty revenue and an increase of $2.3 million in development seat revenue.

The Company previously stated that it expected QNX revenue in the fourth quarter of fiscal 2026 to be in the range of $71 million to $77 million.

QNX revenue in the fourth quarter of fiscal 2026 was $78.7 million.

Secure Communications

The increase in Secure Communications revenue of $5.2 million was primarily due to an increase of $8.6 million in Secusmart product revenue, an increase of $2.1 million in BlackBerry AtHoc product revenue, partially offset by a decrease of $2.9 million in professional services revenue and a decrease of $2.6 million BlackBerry UEM product revenue.

The Company previously stated that it expected Secure Communications revenue in the fourth quarter of fiscal 2026 to be in the range of $61 million to $65 million.

Secure Communications revenue in the fourth quarter of fiscal 2026 was $72.5 million due to higher than expected Secusmart product revenue.

The decrease in Licensing revenue of $3.8 million was primarily due to a decrease in revenue from the Company’s intellectual property licensing arrangements.

The Company previously stated that it expected revenue from intellectual property licensing to be approximately $6 million in each of the four quarters of fiscal 2026.

Revenue from intellectual property licensing was approximately $8.6 million in fourth quarter of fiscal 2025 due to the timing of new licensing deals.

Revenue from intellectual property licensing was approximately $4.8 million in fourth quarter of fiscal 2026.

Total BlackBerry Revenue

The Company previously stated that it expected the total BlackBerry revenue to be in the range of $138 million to $148 million in the fourth quarter of fiscal 2026.

Total BlackBerry revenue was $141.7 million in the fourth quarter of fiscal 2025 primarily due to better than expected Licensing revenue.

Total BlackBerry revenue was $156.0 million in the fourth quarter of fiscal 2026 due to Secure Communications revenue exceeding previously provided guidance for the reasons described above.

GAAP Revenue by Geography

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North America Revenue

The decrease in North America revenue of $8.2 million was primarily due to a decrease of $6.8 million in the Company’s intellectual property licensing arrangements, a decrease of $2.9 million in BlackBerry UEM product revenue and a decrease of $2.2 million in BlackBerry QNX development seats revenue, partially offset by an increase of $2.0 million in BlackBerry Radar and an increase of $1.4 million in BlackBerry AtHoc.

Th e decrease in North America revenue of $6.6 million was primarily due to a decrease of $3.8 million in Licensing revenue, a decrease of $3.1 million in BlackBerry QNX development seat revenue, a decrease of $2.6 million in BlackBerry UEM product revenue and a decrease of $1.8 million in professional services revenue partially offset by an increase of $5.9 million in BlackBerry QNX royalty revenue.

Europe, Middle East and Africa Revenue

The increase in Europe, Middle East and Africa revenue of $5.0 million was primarily due to an increase of $2.5 million relating to product revenue in Secusmart and an increase of $2.2 million in BlackBerry QNX royalty revenue.

The increase in Europe, Middle East and Africa revenue of $12.8 million was primarily due to an increase of $8.7 million in Secusmart product revenue and an increase of $3.3 million in BlackBerry QNX development seat revenue, partially offset by a decrease of $0.8 million in BlackBerry QNX royalty revenue.

Other Regions Revenue

The decrease in Other regions revenue of $8.0 million was primarily due to a decrease of $9.3 million in BlackBerry UEM product revenue and a decrease of $0.9 million in BlackBerry QNX development seats revenue, partially offset by an increase of $2.0 million in professional services.

The increase in Other regions revenue of $8.1 million was primarily due to an increase in of $4.9 million in BlackBerry QNX royalty revenue and an increase of $2.3 million in BlackBerry QNX development seat revenue.

Consolidated Gross Margin

Consolidated gross margin decreased by $18.1 million to approximately $104.1 million in the fourth quarter of fiscal 2025 (fourth quarter of fiscal 2024 - $122.2 million).

The decrease was primarily due to a decreases in revenue from Licensing due to the reasons discussed above in “Revenue by Segment” and lower gross margin from Secusmart due to change in product mix, as the cost of sales for most software and services products does not significantly fluctuate based on business volume.

C onsolidated gross margin increased by $17.3 million to approximately $121.4 million in the fourth quarter of fiscal 2026 (fourth quarter of fiscal 2025 - $104.1 million).

The increase was primarily due to increases in revenue from QNX and Secusmart software licenses.

Consolidated Gross Margin Percentage

Consolidated gross margin percentage decreased by 6.4%, to approximately 73.5% of consolidated revenue in the fourth quarter of fiscal 2025 (fourth quarter of fiscal 2024 - 79.9%).

The decrease was primarily due to a lower gross margin contribution

from Secusmart due to change in product mix and a decrease in contribution in gross margin from Licensing due to the reasons discussed above in “Revenue by Segment”.

Consolidated gross margin percentage increased by 4.3%, to approximately 77.8% of consolidated revenue in the fourth quarter of fiscal 2026 (fourth quarter of fiscal 2025 - 73.5%).

The increase was primarily due to a change in mix, specifically a higher relative gross margin contributions from Secusmart software licenses and QNX.

Gross Margin and Adjusted EBITDA by Segment

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(in millions)

Secure Communications QNX Licensing Segment Totals

Feb 28 Feb 29 Change Feb 28 Feb 29 Change Feb 28 Feb 29 Change Feb 28 Feb 29 Change

QNX Secure Communications Licensing

February 28, Change February 28, Change February 28, Change

2026 2025 2026 2025 2026 2025

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Segment cost of sales 12.2 11.1 1.1 20.3 24.5 (4.2) 1.5 1.6 (0.1)

Segment gross margin $ 42.8 $ 52.7 $ (9.9) $ 54.7 $ 56.2 $ (1.5) $ 7.0 $ 14.0 $ (7.0) $ 104.5 $ 122.9 $ (18.4)

Segment adjusted gross margin $ 66.5 $ 54.7 $ 11.8 $ 52.2 $ 42.8 $ 9.4 $ 3.3 $ 7.0 $ (3.7)

Segment adjusted gross margin % 84 % 83 % 1 % 72 % 64 % 8 % 69 % 81 % (12) %

Segment research and development 19.6 12.9 6.7 12.3 9.0 3.3 — — —

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Segment general and administrative 8.5 8.2 0.3 7.5 9.2 (1.7) (1.5) 7.1 (8.6)

Less amortization included in the above 0.6 1.0 (0.4) 0.6 0.6 — 2.2 2.3 (0.1) 3.4 3.9 (0.5)

Less amortization included in segment cost of sales — — — — — — 1.5 1.5 —

Segment adjusted EBITDA $ 21.4 $ 19.2 $ 2.2 $ 19.5 $ 12.6 $ 6.9 $ 6.3 $ 1.4 $ 4.9

The increase in QNX segment adjusted gross margin of $11.8 million was primarily due to the reasons discussed above in “Revenue by Segment”, partially offset by an increase in cost of sales related to BlackBerry Radar hardware devices.

The increase in QNX segment adjusted gross margin percentage of 1% was due to the same reasons discussed above.

The increase in QNX segment adjusted EBITDA of $2.2 million was primarily due to the reasons discussed above in “Revenue by Segment, partially offset by a decrease in benefit from SIF claims and an increase salaries and benefits expense.

The Company previously stated that it expected QNX segment adjusted EBITDA to be in the range of $17 million to $23 million in the fourth quarter of fiscal 2026.

QNX adjusted EBITDA was $21.4 million in the fourth quarter of fiscal 2026.

Secure Communications

The decrease in Secure Communications gross margin of $9.9 million was primarily due to the reasons discussed above in “Revenue by Segment” and a lower gross margin contribution from Secusmart due to change in product mix.

The decrease in Secure Communications gross margin percentage of 10% was due to the same reasons discussed above.

The decrease in Secure Communications adjusted EBITDA of $4.5 million was primarily due to the reasons discussed above in “Revenue by Segment”, partially offset by the decreases in salaries and benefits expense.

The Company previously stated that it expected Secure Communications adjusted EBITDA to be in the range of $4 million to $6 million in the fourth quarter of fiscal 2025.

Secure Communications adjusted EBITDA was $12.6 million in the fourth quarter of fiscal 2025 due to decreases in salaries and benefits expense, lower cost of sales due to product mix and revenue exceeding the top end of the Company’s expectation ranges.

The decrease in QNX gross margin of $1.5 million was primarily due to an increase in cost of sales related to BlackBerry Radar hardware devices.

The decrease in QNX gross margin percentage of 2% was due to the same reason discussed above.

The increase in QNX adjusted EBITDA of $1.5 million was primarily due to the reasons discussed above in “Revenue by Segment” and a benefit from SIF claims.

The Company previously stated that it expected QNX adjusted EBITDA to be in the range of $8 million to $10 million in the fourth quarter of fiscal 2025.

QNX adjusted EBITDA was $19.2 million in the fourth quarter of fiscal 2025 due to SIF claims, lower than expected salaries and benefits expense and revenue exceeding the top end of the Company’s expectation ranges.

The decrease in Licensing gross margin of $7.0 million was primarily due to the reasons discussed above in “Revenue by Segment”.

The decrease in Licensing gross margin percentage of 10% was due to the same reasons discussed above.

The decrease in Licensing adjusted EBITDA of $11.3 million was primarily due to the reasons discussed above in “Revenue by Segment” and an increase in credit loss provision that was subsequently written off.

The Company previously stated that it expected Licensing adjusted EBITDA to be approximately $3 million in the fourth quarter of fiscal 2025.

Licensing adjusted EBITDA was $1.4 million in the fourth quarter of fiscal 2025 due to the reasons noted above.

The increase in Secure Communications segment adjusted gross margin of $9.4 million was primarily due to the reasons discussed above in “Revenue by Segment” and a higher gross margin contribution from Secusmart due to change in product mix.

The increase in Secure Communications segment adjusted gross margin percentage of 8% was primarily due to a change in mix, specifically an increased gross margin contribution from Secusmart software licenses.

The increase in Secure Communications segment adjusted EBITDA of $6.9 million was primarily due to the reasons discussed above in “Revenue by Segment”, partially offset by an increase in salaries and benefits expense.

The Company previously stated that it expected Secure Communications segment adjusted EBITDA to be in the range of $11 million to $15 million in the fourth quarter of fiscal 2026.

Secure Communications segment adjusted EBITDA was $19.5 million in the fourth quarter of fiscal 2026 due to Secure Communications revenue exceeding previously provided guidance for the reasons described above in “Revenue by Segment”.

The decrease in Licensing segment adjusted gross margin of $3.7 million was primarily due to the reasons discussed above in “Revenue by Segment”.

The decrease in Licensing segment adjusted gross margin percentage of 13% was due to the same reasons discussed above.

The increase in Licensing segment adjusted EBITDA of $4.9 million was primarily due a recovery of credit loss provision, partially offset by a decrease in revenue to the reasons discussed above in “Revenue by Segment”.

The Company previously stated that it expected Licensing segment adjusted EBITDA to be approximately $5 million in the fourth quarter of fiscal 2026.

Licensing segment adjusted EBITDA was $6.3 million in the fourth quarter of fiscal 2026 due to the reasons noted above.

Operating Expenses

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GAAP Operating Expenses

Operating expenses increased by $19.4 million, or 20.9% in the fourth quarter of fiscal 2025, compared to $92.7 million in the third quarter of fiscal 2025 primarily due to an increase of $5.3 million in restructuring cost, an increase of $4.9 million credit loss provision that was subsequently written off, an increase of $4.3 million in impairment of long-lived assets, an increase of $2.9 million in the Company’s deferred share unit cost and an increase of $2.8 million in legal expense, partially offset by a decrease of $4.7 million in variable incentive plan costs.

Operating expenses increased by $0.5 million, or 0.5% in the fourth quarter of fiscal 2026, compared to $98.0 million in the third quarter of fiscal 2026 primarily due to an increase of $4.6 million in salaries and benefits expense and an increase of $1.8 million in sales incentive plan costs, partially offset by a decrease of $2.9 million in restructuring cost and a recovery of $2.6 million of previously recognized credit losses .

Operating expenses decreased by $13.6 million, or 12.1%, in the fourth quarter of fiscal 2026, compared to $112.1 million in the fourth quarter of fiscal 2025.

The decrease was primarily attributable to a decrease of $15.9 million in goodwill impairment, a decrease of $7.0 million in restructuring costs, decrease of $5.3 million salaries and benefits, the increase in benefits of $3.0 million in SIF claims filed, a decrease of $1.6 million in consulting cost, and a decrease of $1.6 million in facilities costs, partially offset by an increase of $4.7 million in credit loss provision that was subsequently written off and an increase of $4.7 million in the Company’s deferred share unit cost.

The decrease was primarily attributable to a decrease of $8.1 million in restructuring costs, a recovery of $7.3 million of previously recognized credit losses , a decrease of $4.4 million in the Company’s deferred share unit costs and a decrease of $4.0 million in impairment of long-lived assets, partially offset by an increase of $5.7 million in variable incentive plan costs and an increase of $5.3 million in salaries and benefits expense.

Adjusted Operating Expenses

Adjusted operating expenses increased by $4.0 million, or 4.7%, to $89.4 million in the fourth quarter of fiscal 2026 compared to $85.4 million in the third quarter of fiscal 2026.

The increase was primarily due to an increase of $4.9 million in credit loss provision that was subsequently written off, an increase of $2.9 million in the Company’s deferred share unit cost and an increase of $0.9 million in marketing and advertising cost, partly offset by a decrease of $1 million in salaries and benefits.

Adjusted operating expenses decreased by $1.9 million, or 2.1%, to $87.4 million in the fourth quarter of fiscal 2025, compared to $89.3 million in the fourth quarter of fiscal 2024.

The decrease was primarily attributable to a decrease of $5.3 million in salaries and benefits costs, the increase in benefits of $3.0 million in SIF claims filed, a decrease of $1.6 million in consulting cost and a decrease of $1.6 million in facilities costs, partially offset by an increase of $4.7 million in credit loss provision that was subsequently written off and an increase of $4.7 million in the Company’s deferred share unit cost.

The increase was primarily due to an increase of $4.6 million in salaries and benefits expense and an increase of $1.8 million in sales incentive plan costs, partially offset by a recovery of $2.6 million of previously recognized credit losses .

Adjusted operating expenses increased by $2.0 million, or 2.3%, to $89.4 million in the fourth quarter of fiscal 2026, compared to $87.4 million in the fourth quarter of fiscal 2025.

The increase was primarily attributable to an increase of $5.7 million in variable incentive costs, an increase of $5.3 million in salaries and benefits costs and a decrease in benefits of $3.5 million in SIF claims filed, partially offset by a recovery of $7.3 million of previously recognized credit losses and a decrease of $4.4 million in the Company’s deferred share unit costs.

Research and Development Expenses

Research and development expenses consist primarily of salaries and benefits costs for technical personnel, new product development costs, travel expenses, office and building costs, infrastructure costs and other employee costs.

Research and development expenses decreased by $5.7 million, or 19.7%, in the fourth quarter of fiscal 2025 compared to the fourth quarter of fiscal 2024, primarily due to the increase in benefits of $3.0 million in SIF claims filed, a decrease of $1.4 million in consulting cost and a decrease of $1.2 million in salaries and benefit cost.

Adjusted research and development expenses decreased by $5.3 million, or 19.4%, to $22.0 million in the fourth quarter of fiscal 2025 compared to $27.3 million in the fourth quarter of fiscal 2024, primarily due to the same reasons described above on a U.S.

Research and development expenses increased by $10.2 million, or 44.0%, in the fourth quarter of fiscal 2026 compared to the fourth quarter of fiscal 2025, primarily due to an increase in $3.9 million in salaries and benefits expense, a decrease in benefits of $3.5 million in SIF claims filed and an increase of $3.0 million in variable incentive plan costs.

Adjusted research and development expenses increased by $10.1 million, or 45.9%, to $32.1 million in the fourth quarter of fiscal 2026 compared to $22.0 million in the fourth quarter of fiscal 2025, primarily due to the same reasons described above on a U.S.

Sales and Marketing Expenses

Sales and marketing expenses consist primarily of marketing, advertising and promotion, salaries and benefits, information technology costs and travel expenses.

Sales and marketing expenses increased by $1.1 million, or 4.2% in fiscal 2025, in the fourth quarter of fiscal 2025 compared to the fourth quarter of fiscal 2024, primarily due to an increase of $0.7 million in variable incentive plan costs and an increase of $0.4 million in stock compensation expense.

Adjusted sales and marketing expenses increased by $0.7 million, or 2.7%, to $26.4 million in the fourth quarter of fiscal 2025 compared to $25.7 million in the fourth quarter of fiscal 2024, primarily due to an increase of $0.7 million in variable incentive plan costs.

General and Administrative Expenses

Sales and marketing expenses increased by $4.5 million, or 16.6% in the fourth quarter of fiscal 2026 compared to the fourth quarter of fiscal 2025, primarily due to an increase of $3.2 million in salaries and benefits expense, an increase of $1.2 million in sales incentive plan costs and an increase of $0.6 million in stock compensation expense, partially offset by a decrease of $1.0 million in marketing costs.

Adjusted sales and marketing expenses increased by $4.0 million, or 15.2%, to $30.4 million in the fourth quarter of fiscal 2026 compared to $26.4 million in the fourth quarter of fiscal 2025, primarily due to an increase of $3.2 million in salaries and benefits expense and an increase of $1.2 million in sales incentive plan costs, partially offset by a decrease of $1.0 million in marketing costs.

General and administration expenses consist primarily of salaries and benefits, external advisory fees, information technology costs, office and related staffing infrastructure costs.

General and administrative expenses decreased by $19.3 million, or 38.6%, in the fourth quarter of fiscal 2026 compared to the fourth quarter of fiscal 2025.

The decrease was primarily due to a decrease of $7.0 million in restructuring costs, a decrease of $4.1 million in salaries and benefits costs and a decrease of $1.6 million in facilities costs, partially offset by an increase of $4.7 million in credit loss provision that was subsequently written off and an increase of $4.7 million in the Company’s deferred share unit cost.

Adjusted general and administrative expenses increased by $3.2 million, or 9.6%, to $36.6 million in the fourth quarter of fiscal 2025 compared to $33.4 million in the fourth quarter of fiscal 2024.

The increase was primarily due to an increase of $4.7 million in credit loss provision that was subsequently written off and an increase of $4.7 million in the Company’s deferred share unit cost, partially offset by a decrease of $4.1 million in salaries and benefits costs and a decrease of $1.6 million in facilities costs.

The decrease was primarily due to a decrease of $8.1 million in restructuring costs, a recovery of $7.3 million of previously recognized credit losses and a decrease of $4.4 million in the Company’s deferred share unit cost, partially offset by an increase of $2.2 million in variable incentive plan costs.

Adjusted general and administrative expenses decreased by $11.6 million, or 31.7%, to $25.0 million in the fourth quarter of fiscal 2026 compared to $36.6 million in the fourth quarter of fiscal 2025.

The decrease was primarily due to a recovery of $7.3 million of previously recognized credit losses and a decrease of $4.4 million in the Company’s deferred share unit costs, partially offset by an increase of $2.2 million in variable incentive plan costs.

Amortization Expense

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Investment Income, Net

Investment income, net, which includes the interest expense from the Debentures, decreased by $2.4 million to investment income, net of $1.6 million in the fourth quarter of fiscal 2025 compared to investment income, net of $4.0 million in the fourth quarter of fiscal 2024.

The decrease in investment income, net is primarily due to a lower yield on cash and investments.

Investment income, net, which includes the interest expense from the Debentures, increased by $1.4 million to investment income, net of $3.0 million in the fourth quarter of fiscal 2026 compared to investment income, net of $1.6 million in the fourth quarter of fiscal 2025.

The increase in investment income, net is primarily due to higher return on cash and investments in the fourth quarter of fiscal 2026 due to a higher cash and investments balance.

For the fourth quarter of fiscal 2026, the Company’s net effective income tax expense rate was approximately 6% (fourth quarter of fiscal 2025 - net effective income tax expense rate of approximately 23%).

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The Company’s net effective income tax rate also reflects the geographic mix of earnings in jurisdictions with different income tax rates.

Net Loss From Continuing Operations

The Company’s loss from continuing operations for the fourth quarter of fiscal 2025 was $7.8 million, or $0.01 basic and diluted loss from continuing operations per share on a U.S.

GAAP basis (fourth quarter of fiscal 2024 - loss from continuing operations of $12.4 million, or $0.02 basic and diluted loss from continuing operations per share).

The increase in loss from continuing operations of $4.6 million was primarily due to a decrease in revenue, as described above in “Revenue by Segment” and a decrease in gross margin percentage, as described above in “Consolidated Gross Margin Percentage”, partially offset by a decrease in operating expenses, as described above in “Operating Expenses”.

Adjusted income from continuing operations was $17.3 million in the fourth quarter of fiscal 2025 or $0.03 adjusted basic earnings from continuing operations per share (fourth quarter of fiscal 2024 - adjusted income from continuing operations of $33.7 million or $0.06 adjusted basic earnings from continuing operations per share).

The decrease in adjusted income from continuing operations of $16.4 million was primarily due to the same reasons describe above on a U.S.

The Company’s net loss for the fourth quarter of fiscal 2025 was $7.4 million, or $0.01 basic and diluted net loss per share on a U.S.

Net Income (loss)

The Company’s net income for the fourth quarter of fiscal 2026 was $24.3 million, or $0.04 basic and diluted net income per share on a U.S.

GAAP basis (fourth quarter of fiscal 2025 - net loss of $7.4 million, or $0.01 basic and diluted net loss per share).

The decrease in net loss of $48.8 million was primarily due to a decrease in loss from discontinued operations and a decrease in operating expenses, as described above in “Operating Expenses”, partially offset by a decrease in revenue, as described above in “Revenue by Segment” and a decrease in gross margin percentage, as described above in “Consolidated Gross Margin Percentage”.

The year over year change of $31.7 million was primarily due to a loss from discontinued operations in the fiscal 2025 which did not recur, a decrease in operating expenses, as described above in “Operating Expenses”, an increase in revenue, as described above in “Revenue by Segment” and an increase in gross margin percentage, as described above in “Consolidated Gross Margin Percentage”.

Adjusted net income was $34.0 million in the fourth quarter of fiscal 2026 or $0.06 adjusted basic earnings per share (fourth quarter of fiscal 2025 - adjusted net income of $17.7 million or $0.03 adjusted basic earnings per share).

The decrease in adjusted net income of $1.3 million was primarily due to the same reasons describe above on a U.S.

The weighted average number of shares outstanding was 594 million common shares for basic and diluted loss per share for the fourth quarter of fiscal 2025.

The increase in adjusted net income of $16.3 million was primarily due to the same reasons describe above on a U.S.

The weighted average number of shares outstanding was 589 million common shares for basic earnings per share and 644 million common shares for diluted earnings per share for the fourth quarter of fiscal 2026.

The weighted average number of shares outstanding was 594 million common shares for basic and diluted loss per share for the fourth quarter of fiscal 2025.

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Liquidity and Capital Resources

Cash, cash equivalents, and investments increased by $112.1 million to $410.3 million as at February 28, 2025 from $298.2 million as at February 29, 2024, primarily due to the cash proceeds received from the sale of the Company’s Cylance business to Arctic Wolf and cash generated from operations.

Cash, cash equivalents, and investments increased by $22.1 million to $432.4 million as at February 28, 2026 fr om $410.3 million as at February 28, 2025, primarily due to the receipt of a $38.1 million deferred cash payment from Arctic Wolf and a $30.0 million guaranteed payment from the Malikie Transaction, partially offset by $60.7 million of common share repurchases under the NCIB program.

A comparative summary of cash, cash equivalents, and investments is set out below:

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Long-term investments (1)

58.3 58.9 (0.6) 35.7 23.2

Cash, cash equivalents, and investments $ 432.4 $ 410.3 $ 22.1 $ 298.2 $ 112.1

______________________________

(1) Includes investments in privately-held companies, including common shares of Arctic Wolf that were received as partial consideration for the sale of the Company’s Cylance endpoint security assets and liabilities to Arctic Wolf.

Investments in privately-held companies are considered illiquid securities without a public market and, as such, they cannot be readily sold or exchanged for cash.

The table below summarizes the current assets, current liabilities, and working capital of the Company:

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Current Assets

The increase in current assets of $84.0 million at the end of fiscal 2025 from the end of fiscal 2024 was primarily due to an increase in cash and cash equivalents of $91.6 million, an increase in other receivable of $27.0 million and an increase of $9.1 million in short-term investments, partially offset by a decrease of $25.0 million in account receivable, net of credit loss, a decrease of $11.6 million in assets held for sale, current, a decrease of $5.1 million in other current assets and a decrease of $2.0 million in income taxes receivable.

At February 28, 2025, other receivables was $48.4 million, an increase of $27.0 million from February 29, 2024.

The increase was primarily due to an increase of $38.6 million related to the present value of the Arctic Wolf delayed cash payment consideration, partially offset by a decrease of $13.2 million related to a certain receivable reclassified from short-term to long-term receivables.

At February 28, 2025, accounts receivable, net of allowance was $173.7 million, a decrease of $25.0 million from February 29, 2024.

The decrease was primarily due to lower revenue recognized over the three months ended February 28, 2025 compared to the three months ended February 29, 2024, partially offset by an increase in days sales outstanding to 102.1 days at the end of the fourth quarter of fiscal 2025 from 100.4 days at the end of the fourth quarter of fiscal 2024.

At February 28, 2025, other current assets was $30.0 million, a decrease of $5.1 million from February 29, 2024.

The decrease was primarily due to a decrease of $2.2 million in prepaid software maintenance.

At February 28, 2025, income taxes receivable was $1.6 million, a decrease of $2.0 million from February 29, 2024.

The decrease was primarily due to tax refunds received.

The decrease in current assets of $23.3 million at the end of fiscal 2026 from the end of fiscal 2025 was primarily due to a decrease in other receivable of $40.9 million and a decrease of $17.7 million in account receivable, net of allowance, partially offset by an increase of $14.1 million in short-term investments, an increase of $12.2 million in other current assets, an increase in cash and cash equivalents of $8.0 million and an increase of $1.0 million in income taxes receivable.

At February 28, 2026, other receivables were $7.5 million, a decrease of $40.9 million from February 28, 2025.

The decrease was primarily due to the receipt of a $38.1 million deferred cash payment from Arctic Wolf collected in the fourth quarter of fiscal 2026.

At February 28, 2026, accounts receivable, net of allowance were $156.0 million, a decrease of $17.7 million from February 28, 2025.

The decrease was primarily due to the collection of a significant receivable from the Government of Malaysia and a decrease in days sales outstanding to 88.1 days at the end of the fourth quarter of fiscal 2026 from 102.1 days at the end of the fourth quarter of fiscal 2025.

At February 28, 2026, other current assets were $42.2 million, an increase of $12.2 million from February 28, 2025.

The increase was primarily due to an increase of $5.0 million in inventory, an increase of $3.1 million in prepaid professional services , an increas e of $1.4 million in prepaid revenue share paid to third party and an incr ease of $1.6 million in prepaid insurance.

At February 28, 2026, income taxes receivable were $2.6 million, an increase of $1.0 million from February 28, 2025.

The increase was primarily due to installments made during the period.

Current Liabilities

The decrease in current liabilities of $12.6 million at the end of fiscal 2025 from the end of fiscal 2024 was primarily due to a decrease in the deferred revenue associated with the sale of Cylance of $49.3 million and a decrease of $2.9 million in income taxes payable, partially offset by an increase of $14.3 million in accounts payable, an increase of $12.8 million in deferred revenue, current, and an increase in accrued liabilities of $12.5 million.

At February 28, 2025, income taxes payable was $25.5 million, reflecting a decrease of $2.9 million compared to February 29, 2024, which was primarily due to a change in the quarterly tax provision and installments made during the period.

At February 28, 2025, accounts payable was $31.1 million, reflecting an increase of $14.3 million from February 29, 2024, which was primarily due to timing of payments of accounts payable.

At February 28, 2025, deferred revenue, current was $161.5 million, which reflects an increase of $12.8 million compared to February 29, 2024 that was attributable to a $7.6 million increase in deferred revenue, current related to BlackBerry UEM, and an increase of $6.9 million in deferred revenue, current related to BlackBerry QNX.

At February 28, 2025, accrued liabilities was $126.2 million, reflecting an increase of $12.5 million compared to February 29, 2024, which was primarily attributable to an increase of $16.3 million in variable incentive plan accrual, partially offset by a decrease of $4.6 million in operating lease liability, current.

The decrease in current liabilities of $76.2 million at the end of fiscal 2026 from the end of fiscal 2025 was primarily due to a decrease of $25.6 million in accounts payable, a decrease of $23.0 million in deferred revenue, current, a decrease in accrued liabilities of $14.5 million and a decrease of $13.1 million in income taxes payable.

At February 28, 2026, income taxes payable were $12.4 million, reflecting a decrease of $13.1 million compared to February 28, 2025, which was primarily due to a change in the quarterly tax provision and installments made during the period.

At February 28, 2026, accounts payable were $5.5 million, reflecting a decrease of $25.6 million from February 28, 2025, which was primarily due to timing of payments.

At February 28, 2026, deferred revenue, current were $138.5 million, which reflects a decrease of $23.0 million compared to February 28, 2025 that was primarily attributable to a $31.9 million decrease in deferred revenue, current related to BlackBerry UEM, partially offset by an increase of $7.4 million in deferred revenue, current related to BlackBerry AtHoc.

At February 28, 2026 , accrued liabilities were $111.7 million, reflecting a decrease of $14.5 million compared to February 28, 2025, which was primarily due to a decrease of $5.6 million in operating lease liability, current, a decrease of $4.2 million in litigation accruals, a decrease of $3.8 million in legal accruals, a decrease of $2.3 million in deferred share unit liability, a decrease of $1.7 million in restructuring cost accruals and a decrease of $1.7 million in professional service fee accrual, partially offset by an increase of $5.0 million in variable incentive plan accrual.

Cash flows for the fiscal year ended February 28, 2026 compared to the fiscal year ended February 28, 2025 were as follows:

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Investing Activities

During the fiscal year ended February 28, 2025, cash flows provided by investing activities were $60.7 million and included cash proceeds of $79.8 million from disposal of discontinued operations, partially offset by cash flows used in transactions involving the acquisitions of short-term and long-term investments, net of the proceeds on sale or maturity in the amount of $9.0 million, intangible asset additions of $7.0 million, and acquisitions of property, plant and equipment of $3.1 million.

During fiscal 2024, cash flows provided by investing activities were $46.6 million and included cash flows used in transactions involving the acquisitions of short-term and long-term investments, net of the proceeds on sale or maturity in the amount of $67.5 million, partially offset by intangible asset additions of $13.8 million and acquisitions of property, plant and equipment of $7.1 million.

During the fiscal year ended February 28, 2026, cash flows provided by investing activities were $15.6 million and included cash proceeds of $38.1 million from the disposal of discontinued operations, partially offset by cash flows used in transactions involving the acquisitions of short-term and long-term investments, net of the proceeds on sale or maturity in the amount of $13.0 million, intangible asset additions of $5.7 million and acquisitions of property, plant and equipment of $3.8 million.

During fiscal 2025, cash flows provided by investing activities were $60.7 million and included cash proceeds of $79.8 million from disposal of discontinued operations, partially offset by cash flows used in transactions involving the acquisitions of short-term and long-term investments, net of the proceeds on sale or maturity in the amount of $9.0 million, partially offset by intangible asset additions of $7.0 million and acquisitions of property, plant and equipment of $3.1 million.

Financing Activities

The increase in cash flows provided by financing activities was $168.2 million for fiscal 2025 due to the net effect of redemption of the 2020 Debentures and issuance of Extension Debentures partially offset by the issuance of the Notes, each as defined below, which did not recur.

During the fiscal year ended February 28, 2026, cash flow used in financing activities was $58.2 million, primarily due to repurchases of common shares of $60.7 million pursuant to the NCIB share buyback program, offset by $2.5 million in common shares issued upon the exercise of stock options and under the employee share purchase plan.

During the fiscal year ended February 28, 2026, the Company repurchased 15.6 million common shares at a cost of $60.7 million.

See Part II, Item 5 “Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities” for further information on the Company’s NCIB share buyback program.

Debt Financing and Other Funding Sources

See Note 7 to the Consolidated Financial Statements for a description of the Company’s $200.0 million aggregate principal amount of 3.00% senior convertible unsecured notes issued in January 2024 (the “Notes”), the $365.0 million aggregate principal amount of convertible debentures issued in September 2020, which matured in November 2023 (the “2020 Debentures”), and the $150.0 million aggregate principal amount of convertible debentures issued in November 2023, which matured in February 2024 (the “Extension Debentures” and, collectively with the Notes and the 2020 Debentures, the “Debentures” and the “2020 Debentures” and, collectively with the Extension Debentures, the “Prior Debentures”).

The Company has $13.5 million in collateralized outstanding letters of credit in support of certain leasing arrangements entered into in the ordinary course of business.

See Note 7 to the Consolidated Financial Statements for a description of the Company’s $200 million aggregate principal amount of 3.00% senior convertible unsecured notes issued in January 2024 (the “Notes”), the $365.0 million aggregate

principal amount of convertible debentures issued in September 2020, which matured in November 2023 (the “2020 Debentures”), and the $150.0 million aggregate principal amount of convertible debentures issued in November 2023, which matured in February 2024 (the “Extension Debentures” and, collectively with the Notes and the 2020 Debentures, the “Debentures”, and the “2020 Debentures” collectively with the Extension Debentures, the “Prior Debentures”).

The Company has $14.2 million in colla teralized outstanding letters of credit in support of certain leasing arrangements entered into in the ordinary course of business.

See Note 4 to the Consolidated Financial Statements for further information concerning the Company’s restricted cash.

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Contractual and Other Obligations

The following table sets out aggregate information about the Company’s contractual and other obligations and the periods in which payments are due as at February 28, 2025:

The following table s ets out aggregate information about the Company’s contractual and other obligations and the periods in which payments are due as at February 28, 2026:

(in millions)

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Total $ 317.1 $ 84.3 $ 232.8

Total contractual and other obligations as at February 28, 2025 decreased by approximately $31.4 million as compared to the February 29, 2024 balance of approximately $344.2 million, which was attributable to a decrease in operating lease obligations and a decrease in purchase obligations and commitments.

The Company does not have any material off-balance sheet arrangements.

Total contractual and other obligations as at February 28, 2026 increased by approximately $4.3 million as compared to the February 28, 2025 balance of approximately $312.8 million, which was attributable to an increase in purchase obligation and commitments of $27.0 million offset by decreases in operating lease obligations and debt interest payments.

The Company does not have any material off-balance sheet a rrangements.

Accounting Policies and Critical Accounting Estimates

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The current macroeconomic environment and competitive dynamics continue to be challenging to the Company’s business and the Company cannot be certain of the duration of these conditions and their potential impact on the Company’s future financial results and cash flows.

The Company’s share price can be affected by, among other things, changes in industry or market conditions, including the effect of competition, changes in the Company’s results of operations, changes in the Company’s forecasts or market expectations relating to future results, and the Company’s strategic initiatives and the market’s assessment

of any such factors.

See Part 1, Item 1A “Risk Factors - The market price of the Company’s common shares is volatile”.

A decline in the Company’s performance, future changes to the Company’s assumptions and estimates used in the LLA impairment test, particularly the expected future cash flows, remaining useful life of the primary asset and terminal value of the asset group, may result in further impairment charges in future periods of some or all of the assets on the Company’s balance sheet.

asset group, may result in further impairment charges in future periods of some or all of the assets on the Company’s balance sheet.

Although it does not affect the Company’s cash flow, an impairment charge to earnings has the effect of decreasing the Company’s earnings or increasing the Company’s losses, as the case may be.

Valuation of Goodwill Reporting Units

In the annual impairment test, the analysis requires significant judgment, including estimation of future cash flows, which is dependent on internal forecasts, estimation of the long-term rates of revenue growth for the Company’s reporting units, estimation of the useful life over which cash flows will occur, terminal growth rates, profitability measures, and determination of the discount rates for the reporting units.

The carrying value of the Company’s assets was assigned to reporting units using reasonable methodologies based on the asset type.

When the carrying value of a reporting unit exceeds its fair value, goodwill of the reporting unit is considered to be impaired and written down to its fair value.

Different judgments could yield different results.

During the third quarter of fiscal 2025 and in connection with the plans to sell the Cylance business, the Company reorganized its reporting structure resulting in its BlackBerry Spark reporting unit being disaggregated into two separate reporting units:

UEM and Cylance.

In accordance with ASC 350 Intangibles - Goodwill and Other, the Company conducted a valuation of the individual reporting units and allocated the goodwill associated with the previous BlackBerry Spark reporting unit to the UEM and Cylance reporting units using a relative fair value approach.

The valuations of the reporting units were based on a combination of the income approach using a discounted future cash flow model, a market-based approach, and estimated exit value approaches for Cylance using the same critical accounting estimates as disclosed in Note 1 to the Consolidated Financial Statements.

Goodwill represents the excess of the acquisition price in a business combination over the fair value of identifiable net assets acquired.

Goodwill is allocated at the date of the business combination.

Goodwill is not amortized but is tested for impairment annually on December 31 or more frequently if events or changes in circumstances indicate the asset may be impaired.

These events and circumstances may include a significant change in legal factors or in the business climate, a significant decline in the Company’s share price, an adverse action or assessment by a regulator, unanticipated competition, a loss of key personnel, significant disposal activity and the testing of recoverability for a significant asset group.

In the annual impairment test, the Company first assesses whether it is more likely than not that an impairment is present in goodwill based upon qualitative factors including macroeconomic factors, industry trends, cost factors, overall financial performance and the Company’s share price and resultant market value capitalization in comparison to its book value.

If the Company determines that it is more likely than not that impairment exists in one of its reporting units, it then conducts an analysis of the carrying value of the reporting unit, including goodwill, compared with its fair value.

The estimated fair value is determined utilizing multiple approaches based on the nature of the reporting units being valued.

In its analysis, the Company utilizes multiple valuation techniques, including the income approach using a discounted future cash flow model, market-based approaches, and the asset value approach.

The analysis requires significant judgment, including estimation of future cash flows, which is dependent on internal forecasts, estimation of the long-term rates of revenue growth for the Company’s reporting units, estimation of the useful life over which cash flows will occur, terminal growth rates, profitability measures, and determination of the discount rates for the reporting units.

Following the assignment of assets, liabilities, and goodwill to the UEM and Cylance reporting units, the Company compared the carrying values of the reporting units against their fair values and determined no impairment was present in either reporting unit.

The carrying value of the Company’s assets is assigned to reporting units using reasonable methodologies based on the asset type.

When the carrying value of a reporting unit exceeds its fair value, goodwill of the reporting unit is considered to be impaired and written down to its fair value.

Different judgments could yield different results.

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A contractually stated price or list price for a good or service may be the SSP of that good or service.

However, in instances where SSP is not directly observable, the Company determines the SSP by maximizing observable inputs and using an adjusted market assessment approach using information that may include market conditions and other observable inputs from the Company’s pricing team, including historical SSP.

However, in instances where SSP is not directly observable, the Company determines the SSP by maximizing observable inputs and using an adjusted

market assessment approach using information that may include market conditions and other observable inputs from the Company’s pricing team, including historical SSP.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis