BB

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How BB rewrote its risk factors

10-K ITEM 1A · FY2025 → FY2026

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RISK FACTORS Investors in the Company’s securities should carefully consider the following risks, as well as the other information contained in MD&A (as defined below) and elsewhere in this Annual Report on Form 10-K for the fiscal year ended February 28, 2026.
Further, the Company’s future success depends in part on the growth, if any, in the markets for embedded solutions and secure communications software.
The Company is engaged in markets that are highly competitive and rapidly evolving, and both the nature of the competition and the scope of the business opportunities afforded by the markets in which the Company competes are uncertain.
Some of the Company’s OEM and Tier 1 customers have advanced the internal development of embedded solutions, and are exploring the use of open source software that is perceived to be free to use.
Further, some of the Company’s competitors may be able to leverage their relationships with enterprise customers based on other products or incorporate functionality into existing products to gain business in a manner that discourages users from purchasing the Company’s solutions, including by selling at zero or negative margins, product bundling or offering closed technology platforms.
The Company’s future success depends upon its ability to enhance and integrate its current products and services, to provide for their compatibility with evolving industry standards and regulations, to address competing technologies and evolving security threats, and to continue to develop and introduce new products and services offering enhanced performance and functionality on a timely basis at competitive prices.
Rapid advances in generative AI and automated coding tools are reducing the time and cost required to design, test, and deploy software applications.
As these technologies become widely accessible, existing and emerging competitors may accelerate their development cycles, release new features more quickly, or replicate functionality comparable to that of the Company’s products with materially lower investment.
Similarly, the use of AI technologies or increasingly pervasive open source tools by the Company’s customers to support development internally could have a negative impact on the Company’s business, including the revenues derived from the number of user licenses and the provision of professional services.
If the Company is unable to integrate AI-enabled development at a competitive pace, its market position, customer acquisition, and renewal rates could be adversely affected.
The successful introduction of new software platforms, such as the Alloy Kore™ platform recently launched by QNX with Vector Informatik, is inherently uncertain and involves numerous costs and risks, including delays in development, unforeseen technical challenges, integration complexities, and lower‑than‑expected customer adoption.
If a new platform fails to perform as intended, fails to drive market adoption, or generates unanticipated maintenance and support costs, the Company’s competitive position, brand reputation and financial results could be materially adversely affected.
If the Company is unable to enhance, develop, introduce and monetize products and services in a timely manner in response to changing market conditions or customer requirements, or if the features of the Company’s new products and services do not meet the demands of its customers or are not sufficiently differentiated from those of its competitors, the Company’s products and services may not achieve market acceptance and the Company’s business, results of operations and financial condition could be materially harmed.
Government demand for communications solutions that support digital sovereignty and can be hosted on-premise, such as the Company’s Secure Communications products, has increased in recent months; however, government procurement is unpredictable and subject to budgetary uncertainty and to reductions or delays in funding authorizations or processes.
In addition, government product requirements are often technically complex and the Company may be required to make costly changes to its products to meet such requirements without any assurance that such changes will generate a positive return or improve the efficacy of its products.
QNX revenue recognition is also subject to delays in the advancement of software-defined vehicle programs and the time to the start of production of new designs by automotive and GEM OEMs.
The occurrence or perception of a breach of the Company’s network cybersecurity measures or an inappropriate disclosure of confidential or personal information could significantly harm its business The Company is continuously exposed to cyber threats through the actions of outside parties, such as hacking, viruses, and other malicious software, denial of service attacks, industrial espionage and other methods designed to breach the Company’s network or data security, which may be further enhanced in frequency or effectiveness through threat actors’ use of AI.
Although malicious attempts to gain unauthorized access to such information affect many companies across various industries, the Company is at a relatively greater risk of being specifically targeted because of its reputation for security and reliability.
In addition, any such event could materially damage the Company’s reputation, which is built in large measure on the security and reliability of BlackBerry products and services, and could result in the loss of investor confidence, channel partners, competitive advantages, revenues and customers, including the Company’s most significant OEM, government and regulated enterprise customers.
The Company’s use of AI technology and tools in its operations and in product development may expose the Company to reputational harm, operational challenges, legal liability, and regulatory concerns The Company is increasingly incorporating AI technologies, including generative AI, into its operations to make business processes more efficient.
The introduction of generative AI into the Company’s operations may result in new or enhanced governmental or regulatory scrutiny, litigation, confidentiality, ethical concerns, or other complications that could adversely affect the Company’s business, reputation, or financial results.
Known risks of generative AI currently include risks related to errors, algorithmic bias, flawed training methodologies, privacy and security, and data provenance.
For example, generative AI may create content that appears to be correct but is factually inaccurate or contains copyrighted or other protected material.
If the Company uses such flawed or protected content to its detriment or the owners of such copyrighted material seek to enforce their rights, the Company may be exposed to brand or reputational harm, competitive harm and/or legal liability.
The evolving AI regulatory environment may, among other impacts, result in inconsistencies among AI regulations and frameworks across jurisdictions, increase the Company’s compliance, governance and research and development costs, or increase the Company’s exposure to regulatory scrutiny, proceedings and claims with the potential to result in significant penalties and reputational harm.
The Company has begun to rely on commercial AI models to support elements of its software development lifecycle.
Any failure by our employees, contractors, or partners to adhere to our policies regarding the appropriate use of AI in development could result in violations of confidentiality obligations, laws, or regulations, jeopardize the Company’s intellectual property rights, or expose the Company’s products or business systems to defects and malware, any of which could adversely affect the Company’s business, financial condition, results of operations, and prospects.
Additionally, the integration of these models into engineering workflows may expose the Company to heightened regulatory scrutiny with respect to products that are classified as high‑risk under emerging global AI and safety‑critical regulations.
Failure to demonstrate adequate human review and testing or explainability of AI‑assisted development processes could delay product approvals or impair the Company’s ability to offer solutions in regulated markets.
Changes in model performance, licensing terms, training‑data provenance, or vendor compliance with applicable AI regulations may impair the Company’s ability to validate and certify its products.
Adverse macroeconomic and geopolitical conditions, including trade policies and national security concerns, have had and may in the future have a material adverse effect on the Company’s business, results of operations and financial condition.
Challenging macroeconomic conditions, including as a result of geopolitical events, changes to international trade policies, public health crises, changes in inflation and interest rates, and disruptions in government operations, automotive labour and global supply chains have negatively impacted and may in the future negatively impact market demand for automobiles and other intelligent edge devices, as well as secure communications solutions.
Sales cycles, in turn, have been materially affected and may in the future materially affect the Company’s business, results of operations and financial condition.
Additionally, the imposition of tariffs and national security policies relating to technology supply chains or other barriers to trade that directly or indirectly impact the Company’s automotive customers, or the Company’s ability to transact business with certain customers, could have a material adverse effect on the Company’s results of operations.
For example, since 2025 the U.S. presidential administration has imposed or threatened to impose new tariffs on imported products from Canada, Mexico, China and other countries, including most notably tariffs on imports of steel, aluminum and automobiles.
The administration has also proposed or is in the process of imposing additional tariffs and has indicated that it intends to pursue significant renegotiations of the Canada–United States–Mexico Agreement (known as the U.S.–Mexico–Canada Agreement in the United States) beginning later in 2026.
Such U.S. tariffs, any retaliatory tariffs, or trade negotiations may adversely affect the operations of the Company’s customers and, consequently, demand for the Company’s solutions.
There can be no assurance that the Company will be able to mitigate the impacts of any trade measures, which could be material to the Company’s business operations or harm the Company’s competitive position.
A failure or perceived failure of the security features or functionality of the Company’s solutions could materially adversely affect the Company’s reputation, financial condition and results of o perations.
Additionally, the Company’s products and services are highly complex and may contain design defects, bugs or security vulnerabilities impacting reliability and performance that are difficult to detect and correct.

and 20 more.

Gone since FY2025

RISK FACTORS Investors in the Company’s securities should carefully consider the following risks, as well as the other information contained in MD&A (as defined below) and elsewhere in this Annual Report on Form 10-K for the fiscal year ended February 28, 2025.
Further, the Company’s future success depends in part on the growth, if any, in the markets for secure communications software and embedded solutions.
The Company is engaged in markets that are highly competitive and rapidly evolving, and has experienced, and expects to continue to experience, intense competition from a number of companies.
No technology has been exclusively or commercially adopted as the industry standard for many of the products and services offered by the Company.
Accordingly, both the nature of the competition and the scope of the business opportunities afforded by the markets in which the Company competes are uncertain.
In particular, some of the Company’s competitors may be able to leverage their relationships with enterprise customers based on other products or incorporate functionality into existing products to gain business in a manner that discourages users from purchasing the Company’s solutions, including by selling at zero or negative margins, product bundling or offering closed technology platforms.
In the automotive sector, some of the Company’s OEM and Tier 1 customers have accelerated internal development of embedded solutions.
In addition, independent industry analysts often issue reports regarding endpoint security solutions and the perception of the Company’s solutions in the marketplace, especially as compared to those of the Company’s competitors, may be significantly influenced by these reports.
If these reports are negative, less frequent or less positive than reports on the Company’s competitors’ products, the Company’s competitive position may be harmed.
The Company’s future success depends upon its ability to enhance and integrate its current products and services, to provide for their compatibility with evolving industry standards and operating systems, to address competing technologies and evolving security threats, and to continue to develop and introduce new products and services offering enhanced performance and functionality on a timely basis at competitive prices The process of developing new technology is complex and uncertain, and involves time, substantial costs and risks, which are further magnified when the development process integrations with third-party platforms.
The development of next-generation technologies that utilize new and advanced features involves making predictions regarding market adoption of such technologies.
The Company may be required to commit significant resources to developing new products, software and services before knowing whether such investment will result in products or services that the market will accept.
The Company’s inability, for technological or other reasons, some of which may be beyond the Company’s control, to enhance, develop, introduce and monetize products and services in a timely manner, or at all, in response to changing market conditions or customer requirements could have a material adverse effect on the Company’s business, results of operations and financial condition or could result in its products and services not achieving market acceptance or becoming obsolete.
In addition, if the Company fails to deliver a compelling customer experience or accurately predict emerging technological trends and the changing needs of customers and end users, or if the features of its new products and services do not meet the demands of its customers or are not sufficiently differentiated from those of its competitors, the Company’s business, results of operations and financial condition could be materially harmed.
Demand from government organizations is often unpredictable and subject to budgetary uncertainty and to reductions or delays in funding authorizations or procurement processes.
In addition, government product requirements are often technically complex and the Company may be required to make costly changes to its products to meet such requirements without any assurance that such changes will generate a sale or improve the efficacy of its products.
QNX revenue recognition is also subject to delays in the advancement of software-defined vehicle programs and the manufacture of new vehicles by automotive OEMs.
The occurrence or perception of a breach of the Company’s network cybersecurity measures or an inappropriate disclosure of confidential or personal information could significantly harm its business The Company is continuously exposed to cyber threats through the actions of outside parties, such as hacking, viruses, and other malicious software, denial of service attacks, industrial espionage and other methods designed to breach the Company’s network or data security.
Although malicious attempts to gain unauthorized access to such information affect many companies across various industries, the Company is at a relatively greater risk of being specifically targeted because of its reputation for security and the nature of its network operations.
In addition, any such event could materially damage the Company’s reputation, which is built in large measure on the security and reliability of BlackBerry products and services, and could result in the loss of investor confidence, channel partners, competitive advantages, revenues and customers, including the Company’s most significant government and regulated enterprise customers.
A failure or perceived failure of the security features of the Company’s solutions could materially adversely affect the Company’s reputation, financial condition and results of operations.
Additionally, the Company’s products and services are highly complex and may contain design defects, bugs or security vulnerabilities that are difficult to detect and correct.
Such internal defects and a variety of external factors, including misconfigurations or errors introduced through collaborations with the Company’s engineering partners, could impair the effectiveness of the Company’s solutions.
Real or perceived defects, errors or vulnerabilities in the Company’s software and services could result in the delay or denial of their market acceptance and may harm the Company’s financial condition, results of operations and reputation as a security solutions vendor.
Adverse macroeconomic and geopolitical conditions, including trade policies, have had and may continue to have a material adverse effect on the Company’s business, results of operations and financial condition.
Challenging macroeconomic conditions, including as a result of geopolitical events, changes to international trade policies, public health crises, automotive labour disruptions, disruptions in global supply chains, and changes in inflation and interest rates, have negatively impacted and may in the future negatively impact consumer demand for automobiles and secure communications solutions, as well as sales cycles, and in turn have materially affected and may continue to materially affect the Company’s business, results of operations and financial condition.
Additionally, the imposition of new tariffs, border taxes or other barriers to trade that directly or indirectly impact the Company’s automotive or other customers could have a material adverse effect on the Company’s results of operations.
For example, since February 2025, the U.S. presidential administration has imposed or threatened to impose new tariffs on imported products from Canada, Mexico, China and other countries, including most notably tariffs on imports of steel, aluminum and automobiles.
The administration has also proposed, or is in the process of, increasing current tariffs and imposing additional tariffs on other imported goods.
Such U.S. tariffs, and any new or additional retaliatory tariffs that may be taken by Canada or other countries in response, may adversely affect the operations of the Company’s customers and, consequently, demand for the Company’s solutions.
The Company is closely monitoring this evolving situation but there can be no assurance that the Company will be able to mitigate the impacts of any trade measures, which could be material to the Company’s business operations or harm the Company’s competitive position.
In the course of its business, the Company is subject to potential litigation claims and enforcement actions arising from its public disclosure.
Given the highly competitive and dynamic industry in which the Company operates and the evolution of the Company’s business strategy over time, the Company’s financial results may not follow any past trends, making it difficult to predict the Company’s financial results.
The Company’s exposure to product liability risk may increase as the Company continues to commercialize its software innovations for autonomous and connected vehicles.
Administrative or regulatory actions against the Company or its employees could also have a material adverse effect on the Company’s business, BlackBerry brand, results of operations and financial condition.
The Company’s operations rely to a significant degree on the efficient and uninterrupted operation of complex technology systems and networks, which are in some cases integrated with those of cloud service providers and third-party data centre operators.
There may also be system or network interruptions if new or upgraded systems are defective or not installed properly, or if data centre operators fail to meet agreed service levels.
The Company has experienced network events, including those arising from third-party applications, in the past, none of which had a material impact on us.
The Company believes decisions by customers to purchase its products depend and will depend in part on the availability and compatibility of software applications and services that are developed and maintained by third-party developers.
The Company may not be able to convince third parties to develop and maintain applications for its secure communications software and embedded solutions platforms.

and 26 more.

Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2025 ↗, FY2026 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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