Cover
Cover - shares | 3 Months Ended | |
May 31, 2023 | Jun. 26, 2023 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | May 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-38232 | |
Entity Registrant Name | BlackBerry Limited | |
Entity Incorporation, State or Country Code | Z4 | |
Entity Tax Identification Number | 98-0164408 | |
Entity Address, Address Line One | 2200 University Ave East | |
Entity Address, City or Town | Waterloo | |
Entity Address, State or Province | ON | |
Entity Address, Country | CA | |
Entity Address, Postal Zip Code | N2K 0A7 | |
City Area Code | (519) | |
Local Phone Number | 888-7465 | |
Title of 12(g) Security | Common Shares | |
Trading Symbol | BB | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 583,239,813 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0001070235 | |
Current Fiscal Year End Date | --02-29 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | May 31, 2023 | Feb. 28, 2023 |
Current | ||
Cash and cash equivalents (note 2) | $ 358 | $ 295 |
Short-term Investments | 158 | 131 |
Accounts Receivable, after Allowance for Credit Loss, Current | 117 | 120 |
Other receivables (note 3) | 8 | 12 |
Income taxes receivable | 3 | 3 |
Other current assets (note 3) | 52 | 182 |
Assets, Current, Total | 696 | 743 |
Restricted cash and cash equivalents (note 2) | 27 | 27 |
Long-term investments (note 2) | 35 | 34 |
Other long-term assets (note 3) | 60 | 8 |
Operating Lease, Right-of-Use Asset | 44 | 44 |
Property, plant and equipment, net (note 3) | 24 | 25 |
Goodwill (note 3) | 596 | 595 |
Intangible assets, net (note 3) | 192 | 203 |
Assets | 1,674 | 1,679 |
Current | ||
Accounts payable | 21 | 24 |
Accrued liabilities (note 3) | 128 | 143 |
Income taxes payable (note 4) | 21 | 20 |
Debentures (note 5) | 389 | 367 |
Deferred revenue, current (note 10) | 177 | 175 |
Total current liabilities | 736 | 729 |
Deferred revenue, non-current (note 10) | 26 | 40 |
Operating lease liabilities | 52 | 52 |
Other long-term liabilities | 1 | 1 |
Total liabilities | 815 | 822 |
Capital stock and additional paid-in capital | ||
Preferred shares: authorized unlimited number of non-voting, cumulative, redeemable and retractable | 0 | 0 |
Common shares: authorized unlimited number of non-voting, redeemable, retractable Class A common shares and unlimited number of voting common shares Issued - 583,237,331 voting common shares (February 28, 2023 - 582,157,203) | 2,920 | 2,909 |
Deficit | (2,039) | (2,028) |
Accumulated other comprehensive loss (note 8) | (22) | (24) |
Total shareholders' equity | 859 | 857 |
Total liabilities and shareholders' equity | $ 1,674 | $ 1,679 |
Common issued (in shares) | 583,237,331 | 582,157,203 |
Common outstanding (in shares) | 583,237,331 | 582,157,203 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Jun. 26, 2023 | May 31, 2023 | Feb. 28, 2023 | Feb. 28, 2022 |
Statement of Financial Position [Abstract] | ||||
Entity Common Stock, Shares Outstanding | 583,239,813 | |||
Common outstanding (in shares) | 583,237,331 | 582,157,203 | ||
Common issued (in shares) | 583,237,331 | 582,157,203 | ||
Accounts Receivable, Allowance for Credit Loss | $ 6 | $ 1 | $ 4 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) $ in Millions | Total | Capital Stock and Additional Paid-in Capital | Deficit | Accumulated Other Comprehensive Loss |
Beginning Balance at Feb. 28, 2022 | $ 1,556 | $ 2,869 | $ (1,294) | $ (19) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net loss | (181) | (181) | ||
Other comprehensive income (loss) | (1) | (1) | ||
Stock-based compensation | 8 | 8 | ||
Exercise of stock options | 0 | 0 | ||
Employee share purchase plan | 3 | 3 | ||
Ending Balance at May. 31, 2022 | 1,385 | 2,880 | (1,475) | (20) |
Beginning Balance at Feb. 28, 2023 | 857 | 2,909 | (2,028) | (24) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Net loss | (11) | (11) | ||
Other comprehensive income (loss) | 2 | 2 | ||
Stock-based compensation | 9 | 9 | ||
Employee share purchase plan | 2 | 2 | ||
Ending Balance at May. 31, 2023 | $ 859 | $ 2,920 | $ (2,039) | $ (22) |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Millions | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Revenue | ||
Revenues | $ 373 | $ 168 |
Cost of sales | ||
Cost of sales | 194 | 64 |
Gross margin | 179 | 104 |
Operating expenses | ||
Research and development | 54 | 53 |
Selling, marketing and administration | 99 | 82 |
Amortization | 15 | 27 |
Debentures fair value adjustment | 22 | (46) |
Litigation Settlement, Expense | 0 | 165 |
Total operating expenses | 190 | 281 |
Operating loss | (11) | (177) |
Investment income (loss), net (note 2 and note 5) | 3 | (1) |
Loss before income taxes | (8) | (178) |
Provision for income taxes (note 4) | 3 | 3 |
Net loss | $ (11) | $ (181) |
Loss per share (note 7) | ||
Earnings (Loss) Per Share, Basic (in usd per share) | $ (0.02) | $ (0.31) |
Earnings (Loss) Per Share, Diluted (in usd per share) | $ (0.02) | $ (0.35) |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Millions | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (11) | $ (181) |
Other comprehensive income (loss) | ||
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), Reclassification, after Tax | 1 | 1 |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | 1 | (4) |
Other Comprehensive Income (Loss), Financial Liability, Fair Value Option, Unrealized Gain (Loss) Arising During Period, after Tax | 0 | 2 |
Other comprehensive income (loss) | 2 | (1) |
Comprehensive loss | $ (9) | $ (182) |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Statement of Comprehensive Income [Abstract] | ||
OCI, Foreign Currency Transaction and Translation Gain (Loss), Arising During Period, Tax | $ 0 | $ 0 |
Other Comprehensive Income (Loss), Financial Liability, Fair Value Option, Unrealized Gain (Loss) Arising During Period, Tax | 0 | 0 |
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), after Reclassification, Tax | $ 0 | $ 0 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Cash flows from operating activities | ||
Net loss | $ (11) | $ (181) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Amortization | 16 | 29 |
Stock-based compensation | 9 | 8 |
Intellectual property disposed of by sale | 147 | 0 |
Debentures fair value adjustment | 22 | (46) |
Operating leases | (1) | (3) |
Net changes in working capital items | ||
Accounts receivable, net of allowance | 3 | 36 |
Other receivables | 4 | 4 |
Other assets | (62) | (9) |
Accounts payable | (3) | (8) |
Accrued liabilities | (14) | 148 |
Income taxes payable | 1 | 2 |
Deferred revenue | (12) | (22) |
Net cash provided by (used in) operating activities | 99 | (42) |
Cash flows from investing activities | ||
Acquisition of long-term investments | 1 | 0 |
Acquisition of property, plant and equipment | (2) | (1) |
Acquisition of intangible assets | (8) | (8) |
Acquisition of short-term investments | 66 | 164 |
Proceeds on sale or maturity of short-term investments | 39 | 226 |
Net cash provided by (used in) investing activities | (38) | 53 |
Cash flows from financing activities | ||
Issuance of common shares | 2 | 3 |
Net cash provided by financing activities | 2 | 3 |
Effect of foreign exchange loss on cash, cash equivalents, restricted cash, and restricted cash equivalents | 0 | (1) |
Net increase in cash, cash equivalents, restricted cash, and restricted cash equivalents during the period | 63 | 13 |
Cash, cash equivalents, restricted cash, and restricted cash equivalents, beginning of period | 322 | 406 |
Cash, cash equivalents, restricted cash, and restricted cash equivalents, end of period | $ 385 | $ 419 |
Blackberry Limited and Summary
Blackberry Limited and Summary of Significant Accounting Policies and Critical Accounting Estimates | 3 Months Ended |
May 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Significant Accounting Policies and Critical Accounting Estimates | 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND CRITICAL ACCOUNTING ESTIMATES Basis of Presentation and Preparation These interim consolidated financial statements have been prepared by management in accordance with United States generally accepted accounting principles (“U.S. GAAP”). They do not include all of the disclosures required by U.S. GAAP for annual financial statements and should be read in conjunction with the audited consolidated financial statements of BlackBerry Limited (the “Company”) for the year ended February 28, 2023 (the “Annual Financial Statements”), which have been prepared in accordance with U.S. GAAP. In the opinion of management, all normal recurring adjustments considered necessary for fair presentation have been included in these interim consolidated financial statements. Operating results for the three months ended May 31, 2023 are not necessarily indicative of the results that may be expected for the full year ending February 29, 2024. The consolidated balance sheet at February 28, 2023 was derived from the audited Annual Financial Statements but does not contain all of the footnote disclosures from the Annual Financial Statements. The preparation of the consolidated financial statements requires management to make estimates and assumptions with respect to the reported amounts of assets, liabilities, revenue and expenses and the disclosure of contingent assets and liabilities. Actual results could differ from these estimates and any such differences may be material to the Company’s consolidated financial statements. Certain of the comparative figures have been reclassified to conform to the current period’s presentation. The Company is organized and managed as three reportable operating segments: Cybersecurity, IoT (collectively, “Software & Services”), and Licensing and Other, as further discussed in Note 10. Significant Accounting Policies and Critical Accounting Estimates There have been no material changes to the Company’s accounting policies or critical accounting estimates from those described in the Annual Financial Statements other than those noted below. Critical Accounting Estimates during the Quarter (Note 10) To the extent the transaction price in a contract with a customer includes variable consideration, the Company estimates the amount of variable consideration that should be included in the price utilizing either the expected value method or the most likely amount method, depending on the nature of the variable consideration. The Company also estimates whether and how much variable consideration is subject to constraint if it cannot conclude it is probable that a significant reversal in revenue will not occur, due to factors such as: the consideration being highly susceptible to factors outside the Company’s influence, the period of time before the variable consideration is resolved, the Company’s previous experience with similar contracts, the Company’s history of price concessions or changing of payment terms, and whether there is a large number and broad range of possible variable consideration amounts. To the extent the Company determines that there is a significant financing component in a contract with a customer, it determines the impact of the time value of money in adjusting the transaction price to account for the income associated with the financing component by estimating the discount rate that would be reflected in a separate financing transaction between the customer and the Company at contract inception, based upon the credit characteristics of the customer receiving financing in the contract. Accounting Standards Adopted During Fiscal 2024 |
Fair Value Measurements, Cash,
Fair Value Measurements, Cash, Cash Equivalents and Investments | 3 Months Ended |
May 31, 2023 | |
Cash and Cash Equivalents [Abstract] | |
Fair Value Measurements, Cash, Cash Equivalents and Investments | FAIR VALUE MEASUREMENTS, CASH, CASH EQUIVALENTS AND INVESTMENTS Fair Value The Company defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use in pricing the asset or liability, such as inherent risk, non-performance risk and credit risk. The Company applies the following fair value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value into three levels: • Level 1 - Unadjusted quoted prices at the measurement date for identical assets or liabilities in active markets. • Level 2 - Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. • Level 3 - Significant unobservable inputs that are supported by little or no market activity. The fair value hierarchy also requires the Company to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The Company’s cash and cash equivalents, accounts receivable, other receivables, accounts payable and accrued liabilities are carried at amounts that approximate their fair values (Level 2 measurement) due to their short maturities. Recurring Fair Value Measurements In determining the fair value of investments held, the Company primarily relies on an independent third-party valuator for the fair valuation of securities. The Company also reviews the inputs used in the valuation process and assesses the pricing of the securities for reasonableness after conducting its own internal collection of quoted prices from brokers. Fair values for all investment categories provided by the independent third-party valuator that are in excess of 0.5% from the fair values determined by the Company are communicated to the independent third-party valuator for consideration of reasonableness. The independent third-party valuator considers the information provided by the Company before determining whether a change in their original pricing is warranted. When the Company concludes that there is a significant financing component included within a contract with a customer due to timing differences between the fulfillment of certain performance obligations and the receipt of payment for those performance obligations, the Company determines the present value of the future consideration utilizing the discount rate that would be reflected in a separate financing transaction between the customer and the Company at contract inception based upon the credit characteristics of the customer receiving financing in the contract. For a description of how the fair value of the Debentures (as defined in Note 5) was determined, see the “Convertible debentures” accounting policies in Note 1 to the Annual Financial Statements. The Debentures are classified as Level 3. Non-Recurring Fair Value Measurements Upon the occurrence of certain events, the Company re-measures the fair value of non-marketable equity investments for which it utilizes the measurement alternative, and long-lived assets, including property, plant and equipment, operating lease ROU assets, intangible assets and goodwill if an impairment or observable price adjustment is recognized in the current period. Non-Marketable Equity Investments Measured Using the Measurement Alternative Non-marketable equity investments measured using the measurement alternative include investments in privately held companies without readily determinable fair values in which the Company does not own a controlling interest or have significant influence. The estimation of fair value used in the fair value measurements required the use of significant unobservable inputs, and as a result, the fair value measurements were classified as Level 3. Cash, Cash Equivalents and Investments The components of cash, cash equivalents and investments by fair value level as at May 31, 2023 were as follows: Cost Basis (1) Unrealized Unrealized Fair Value Cash and Short-term Long-term Restricted Cash and Cash Equivalents Bank balances $ 85 $ — $ — $ 85 $ 83 $ — $ — $ 2 Other investments 29 6 — 35 — — 35 — 114 6 — 120 83 — 35 2 Level 1: Equity securities 10 — (10) — — — — — Level 2: Term deposits and certificates of deposits 53 — — 53 31 — — 22 Bankers’ acceptances/bearer deposit notes 106 — — 106 106 — — — Commercial paper 172 — — 172 84 85 — 3 Non-U.S. promissory notes 83 — — 83 32 51 — — Non-U.S. treasury bills/notes 22 — — 22 22 — — — Corporate notes/bonds 22 — — 22 — 22 — — 458 — — 458 275 158 — 25 $ 582 $ 6 $ (10) $ 578 $ 358 $ 158 $ 35 $ 27 ______________________________ (1) Cost basis for other investments includes the effect of returns of capital and impairment. The components of cash, cash equivalents and investments by fair value level as at February 28, 2023 were as follows: Cost Basis (1) Unrealized Unrealized Fair Value Cash and Short-term Long-term Restricted Cash and Cash Equivalents Bank balances $ 89 $ — $ — $ 89 $ 87 $ — $ — $ 2 Other investments 26 2 — 28 — — 28 — 115 2 — 117 87 — 28 2 Level 1: Equity securities 10 — (10) — — — — — Level 2: Term deposits, and certificates of deposits 33 — — 33 8 — — 25 Bearer deposit notes 82 — — 82 82 — — — Commercial paper 159 — — 159 108 51 — — Non-U.S. promissory notes 45 — — 45 — 45 — — Non-U.S. government sponsored enterprise notes 30 — — 30 10 20 — — Corporate notes/bonds 15 — — 15 — 15 — — 364 — — 364 208 131 — 25 Level 3: Other investments 2 4 — 6 — — 6 — $ 491 $ 6 $ (10) $ 487 $ 295 $ 131 $ 34 $ 27 ______________________________ (1) Cost basis for other investments includes the effect of returns of capital and impairment. As at May 31, 2023, the Company had non-marketable equity investments without readily determinable fair value of $35 million (February 28, 2023 - $34 million). As of May 31, 2023, the Company has recorded a cumulative impairment of $3 million to the carrying value of certain other non-marketable equity investments without readily determinable fair value (February 28, 2023 - $3 million). There were no realized gains or losses on available-for-sale securities for the three months ended May 31, 2023 and May 31, 2022. The Company has restricted cash and cash equivalents, consisting of cash and securities pledged as collateral to major banking partners in support of the Company’s requirements for letters of credit. These letters of credit support certain leasing arrangements entered into in the ordinary course of business. The letters of credit are for terms ranging from one two The following table provides a reconciliation of cash, cash equivalents, restricted cash, and restricted cash equivalents as at May 31, 2023 and February 28, 2023 from the consolidated balance sheets to the consolidated statements of cash flows: As at May 31, 2023 February 28, 2023 Cash and cash equivalents $ 358 $ 295 Restricted cash and cash equivalents 27 27 Total cash, cash equivalents, restricted cash, and restricted cash equivalents presented in the consolidated statements of cash flows $ 385 $ 322 The contractual maturities of available-for-sale investments as at May 31, 2023 and February 28, 2023 were as follows: As at May 31, 2023 February 28, 2023 Cost Basis Fair Value Cost Basis Fair Value Due in one year or less $ 458 $ 458 $ 364 $ 364 No fixed maturity 10 — 10 — $ 468 $ 458 $ 374 $ 364 |
Consolidated Balance Sheets Det
Consolidated Balance Sheets Details | 3 Months Ended |
May 31, 2023 | |
Balance Sheet Related Disclosures [Abstract] | |
Consolidated Balance Sheet Details | 3. CONSOLIDATED BALANCE SHEET DETAILS Accounts Receivable, Net of Allowance The allowance for credit losses as at May 31, 2023 was $6 million (February 28, 2023 - $1 million). The Company recognizes current estimated credit losses (“CECL”) for accounts receivable. The CECL for accounts receivable are estimated based on days past due and region for each customer in relation to a representative pool of assets consisting of a large number of customers with similar risk characteristics that operate under similar economic environments. The Company determined the CECL by estimating historical credit loss experience based on the past due status and region of the customers, adjusted as appropriate to reflect current conditions and estimates of future economic conditions. When specific customers are identified as no longer sharing the same risk profile as their current pool, they are removed from the pool and evaluated separately. The Company also has long-term accounts receivable included in Other Long-term Assets. The CECL for the long-term accounts receivable is estimated using the probability of default method and the default exposure due to limited historical information. The exposure of default is represented by the assets’ amortized carrying amount at the reporting date. The following table sets forth the activity in the Company’s allowance for credit losses: Carrying Amount Beginning balance as of February 28, 2022 $ 4 Prior period provision for expected credit losses 1 Write-offs charged against the allowance (4) Ending balance of the allowance for credit loss as at February 28, 2023 1 Current period provision for expected credit losses 5 Ending balance of the allowance for credit loss as at May 31, 2023 $ 6 The allowance for credit losses as at May 31, 2023 consists of $2 million (February 28, 2023 - $1 million) relating to CECL estimated based on days past due and region and $4 million (February 28, 2023 - nil) relating to specific customers that were evaluated separately. There was one customer that comprised more than 10% of accounts receivable as at May 31, 2023 (February 28, 2023 - two customers comprised more than 10%). Other Receivables As at May 31, 2023 and February 28, 2023, other receivables included items such as claims filed with the Ministry of Innovation, Science and Economic Development Canada relating to its Strategic Innovation Fund program’s investment in BlackBerry QNX, among other items, none of which were greater than 5% of the current assets balance. Other Current Assets Other current assets comprised the following: As at May 31, 2023 February 28, 2023 Intellectual property $ — $ 141 Other 52 41 $ 52 $ 182 As described in Note 10, on May 11, 2023, the Company completed its previously announced patent sale with Malikie Innovations Limited (“Malikie”) and recognized revenue of $218 million and cost of sales of $147 million, which is comprised of the carrying value of the intellectual property of $141 million referred to above, and $6 million of capitalized costs during the quarter related to patent maintenance. See Note 10 under the heading “Patent Sale”. Other current assets also included the current portion of deferred commissions and prepaid expenses, among other items, none of which were greater than 5% of the current assets balance as at the balance sheet dates. Property, Plant and Equipment, Net Property, plant and equipment comprised the following: As at May 31, 2023 February 28, 2023 Cost BlackBerry operations and other information technology $ 85 $ 84 Leasehold improvements and other 19 19 Furniture and fixtures 9 9 Manufacturing, repair and research and development equipment 2 2 115 114 Accumulated amortization 91 89 Net book value $ 24 $ 25 Intangible Assets, Net Intangible assets comprised the following: As at May 31, 2023 Cost Accumulated Net Book Acquired technology $ 900 $ 830 $ 70 Other acquired intangibles 386 322 64 Intellectual property 124 66 58 $ 1,410 $ 1,218 $ 192 As at February 28, 2023 Cost Accumulated Net Book Acquired technology $ 900 $ 824 $ 76 Other acquired intangibles 386 318 68 Intellectual property 123 64 59 $ 1,409 $ 1,206 $ 203 For the three months ended May 31, 2023, amortization expense related to intangible assets amounted to $13 million (three months ended May 31, 2022 - $25 million). Total additions to intangible assets for the three months ended May 31, 2023 amounted to $2 million (three months ended May 31, 2022 - $8 million). During the three months ended May 31, 2023, additions to intangible assets primarily consisted of payments for intellectual property relating to patent maintenance, registration and license fees. Based on the carrying value of the identified intangible assets as at May 31, 2023, and assuming no subsequent impairment of the underlying assets, the annual amortization expense for the remainder of fiscal 2024 and each of the five succeeding years is expected to be as follows: fiscal 2024 - $35 million; fiscal 2025 - $41 million; fiscal 2026 - $37 million; fiscal 2027 - $32 million; fiscal 2028 - $19 million and fiscal 2029 - $6 million. Goodwill Changes to the carrying amount of goodwill during the three months ended May 31, 2023 were as follows: Carrying Amount Carrying amount as at February 28, 2022 $ 844 Goodwill impairment charge (245) Effect of foreign exchange on non-U.S. dollar denominated goodwill (4) Carrying amount as at February 28, 2023 595 Effect of foreign exchange on non-U.S. dollar denominated goodwill 1 Carrying amount as at May 31, 2023 $ 596 Other Long-term Assets As at May 31, 2023, other long-term assets included long-term receivables related to intellectual property sold, see Note 10 under the heading “Patent Sale”, long-term receivables, and the long-term portion of deferred commission, among other items, none of which were greater than 5% of the total assets balance. As at February 28, 2023, other long-term assets included the long-term portion of deferred commission, among other items, none of which were greater than 5% of the total assets balance. Accrued Liabilities As at May 31, 2023 and February 28, 2023, other accrued liabilities included operating lease liabilities, current, accrued royalties, accrued director fees, accrued vendor liabilities, variable incentive accrual and payroll withholding taxes, among other items, none of which were greater than 5% of the current liabilities balance in any of the periods presented. |
Income Taxes
Income Taxes | 3 Months Ended |
May 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES For the three months ended May 31, 2023, the Company’s net effective income tax expense rate was approximately 38% compared to a net effective income tax expense rate of 2% for the three months ended May 31, 2022. The Company’s income tax rate reflects the change in unrecognized income tax benefit, if any, and the fact that the Company has a significant valuation allowance against its deferred income tax assets, and in particular, the change in fair value of the Debentures, amongst other items, is offset by a corresponding adjustment of the valuation allowance. The Company’s net effective income tax rate also reflects the geographic mix of earnings in jurisdictions with different income tax rates. The Company’s total unrecognized income tax benefits as at May 31, 2023 were $21 million (February 28, 2023 - $21 million). As at May 31, 2023, $21 million of the unrecognized income tax benefits have been netted against deferred income tax assets and nil has been recorded within income taxes payable on the Company’s consolidated balance sheets. The Company is subject to ongoing examination by tax authorities in certain jurisdictions in which it operates. The Company regularly assesses the status of these examinations and the potential for adverse outcomes to determine the adequacy of the provision for income taxes as well as the provisions for indirect and other taxes and related penalties and interest. While the final resolution of audits is uncertain, the Company believes the ultimate resolution of these audits will not have a material adverse effect on its consolidated financial position, liquidity or results of operations. |
Debentures
Debentures | 3 Months Ended |
May 31, 2023 | |
Debt Disclosure [Abstract] | |
Debentures | DEBENTURES On September 1, 2020, Hamblin Watsa Investment Counsel Ltd., in its capacity as investment manager of Fairfax Financial Holdings Limited (“Fairfax”), and another institutional investor invested in the Company through a $365 million private placement of debentures (the “Debentures”). The Debentures mature on November 13, 2023. Due to the conversion option and other embedded derivatives within the Debentures, the Company has elected to record the Debentures, including the debt itself and all embedded derivatives, at fair value and present the Debentures as a single hybrid financial instrument. No portion of the fair value of the Debentures has been recorded as equity, nor would be if the embedded derivatives were bifurcated from the host debt contract. Each period, the fair value of the Debentures is recalculated and resulting gains and losses from the change in fair value of the Debentures associated with non-credit components are recognized in income, while the change in fair value associated with credit components is recognized in accumulated other comprehensive loss (“AOCL”). The fair value of the Debentures has been determined using the significant Level 2 inputs interest rate curves, the market price and volatility of the Company’s listed common shares, and the significant Level 3 inputs related to credit spread and the implied discount of the Debentures at issuance. The Company originally determined its credit spread by calibrating to observable trades of the previously-outstanding convertible debentures issued by the Company and trending the calibrated spread to valuation dates utilizing an appropriate credit index. The Company’s credit spread was determined to be 7.90% as of the issuance date of the Debentures and 7.44% as of May 31, 2023. An increase in credit spread will result in a decrease in the fair value of Debentures and vice versa. The fair value of the Debentures on September 1, 2020 was determined to be approximately $456 million and the implied discount approximately $91 million. The Company determined the implied discount on the Debentures by calculating the fair value of the Debentures on September 1, 2020 utilizing the above credit spread and other inputs described above. The following table summarizes the change in fair value of the Debentures for the three months ended May 31, 2023, which also represents the total changes through earnings of items classified as Level 3 in the fair value hierarchy: As at May 31, 2023 Balance as at February 28, 2023 $ 367 Change in fair value of the Debentures 22 Balance as at May 31, 2023 $ 389 The difference between the fair value of the Debentures and the unpaid principal balance of $365 million is $24 million. The following table shows the impact of the changes in fair value of the Debentures for the three months ended May 31, 2023 and May 31, 2022: Three Months Ended May 31, 2023 May 31, 2022 Income (charge) associated with the change in fair value from non-credit components recorded in the consolidated statements of operations $ (22) $ 46 Income associated with the change in fair value from instrument-specific credit components recorded in AOCL — 2 Total decrease (increase) in the fair value of the Debentures $ (22) $ 48 For the three months ended May 31, 2023, the Company recorded interest expense related to the Debentures of $2 million, which has been included in investment income (loss), net on the Company’s consolidated statements of operations (three months ended May 31, 2022 - $2 million). Fairfax, a related party under U.S. GAAP due to its beneficial ownership of common shares in the Company after taking into account potential conversion of the Debentures, owns $330 million principal amount of the Debentures. As such, the payment of interest on the Debentures to Fairfax represents a related party transaction. Fairfax receives interest at the same rate as other holders of the Debentures. |
Capital Stock
Capital Stock | 3 Months Ended |
May 31, 2023 | |
Equity [Abstract] | |
Capital Stock | CAPITAL STOCK The following details the changes in issued and outstanding common shares for the three months ended May 31, 2023: Capital Stock and Stock Amount Common shares outstanding as at February 28, 2023 582,157 $ 2,909 Exercise of stock options 52 — Common shares issued for restricted share unit settlements 461 — Stock-based compensation — 9 Common shares issued for employee share purchase plan 567 2 Common shares outstanding as at May 31, 2023 583,237 $ 2,920 The Company had 583 million voting common shares outstanding, 0.4 million options to purchase voting common shares, 18 million RSUs and 2 million DSUs outstanding as at June 26, 2023. In addition, 60.8 million common shares are issuable upon conversion in full of the Debentures as described in Note 5. |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 3 Months Ended |
May 31, 2023 | |
Earnings Per Share [Abstract] | |
Earnings (Loss) Per Share | LOSS PER SHARE The following table sets forth the computation of basic and diluted loss per share: Three Months Ended May 31, 2023 May 31, 2022 Net loss for basic loss per share available to common shareholders $ (11) $ (181) Less: Debentures fair value adjustment (1) (2) — (46) Add: interest expense on Debentures (1) (2) — 2 Net loss for diluted loss per share available to common shareholders $ (11) $ (225) Weighted average number of shares outstanding (000’s) - basic (3) 582,812 576,877 Effect of dilutive securities (000’s) Conversion of Debentures (1) (2) — 60,833 Weighted average number of shares and assumed conversions (000’s) diluted 582,812 637,710 Loss per share - reported Basic $ (0.02) $ (0.31) Diluted $ (0.02) $ (0.35) ______________________________ (1) The Company has presented the dilutive effect of the Debentures using the if-converted method, assuming conversion at the beginning of the quarter for the three months ended May 31, 2022. Accordingly, to calculate diluted loss per share, the Company adjusted net loss by eliminating the fair value adjustment made to the Debentures and interest expense incurred on the Debentures for the three months ended May 31, 2022, and added the number of shares that would have been issued upon conversion to the diluted weighted average number of shares outstanding. See Note 5 for details on the Debentures. (2) The Company has not presented the dilutive effect of the Debentures using the if-converted method in the calculation of diluted loss per share for the three months ended May 31, 2023, as to do so would be antidilutive. See Note 5 for details on the Debentures. (3) The Company has not presented the dilutive effect of in-the-money options and RSUs that will be settled upon vesting by the issuance of new common shares in the calculation of diluted loss per share for the three months ended May 31, 2023 and May 31, 2022, as to do so would be antidilutive. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 3 Months Ended |
May 31, 2023 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Loss | 8. ACCUMULATED OTHER COMPREHENSIVE LOSS The changes in AOCL by component net of tax, for the three months ended May 31, 2023 and May 31, 2022 were as follows: Three Months Ended May 31, 2023 May 31, 2022 Cash Flow Hedges Balance, beginning of period $ (1) $ — Other comprehensive income before reclassification — 1 Amounts reclassified from AOCL into net loss 1 — Accumulated net unrealized gains on derivative instruments designated as cash flow hedges $ — $ 1 Foreign Currency Cumulative Translation Adjustment Balance, beginning of period $ (16) $ (10) Other comprehensive income (loss) 1 (4) Foreign currency cumulative translation adjustment $ (15) $ (14) Change in Fair Value From Instrument-Specific Credit Risk On Debentures Balance, beginning of period $ (6) $ (8) Other comprehensive income before reclassification — 2 Change in fair value from instruments-specific credit risk on Debentures $ (6) $ (6) Other Post-Employment Benefit Obligations Actuarial losses associated with other post-employment benefit obligations $ (1) $ (1) Accumulated Other Comprehensive Loss, End of Period $ (22) $ (20) |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
May 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES (a) Letters of Credit The Company had $26 million in collateralized outstanding letters of credit in support of certain leasing arrangements entered into in the ordinary course of business as of May 31, 2023. See the discussion of restricted cash in Note 2. (b) Contingencies Litigation The Company is involved in litigation in the normal course of its business, both as a defendant and as a plaintiff. The Company is subject to a variety of claims (including claims related to patent infringement, purported class actions and other claims in the normal course of business) and may be subject to additional claims either directly or through indemnities against claims that it provides to certain of its partners and customers. In particular, the industry in which the Company competes has many participants that own, or claim to own, intellectual property, including participants that have been issued patents and may have filed patent applications or may obtain additional patents and proprietary rights for technologies similar to those used by the Company in its products. The Company has received, and may receive in the future, assertions and claims from third parties that the Company’s products infringe on their patents or other intellectual property rights. Litigation has been, and will likely continue to be, necessary to determine the scope, enforceability and validity of third-party proprietary rights or to establish the Company’s proprietary rights. Regardless of whether claims against the Company have merit, those claims could be time-consuming to evaluate and defend, result in costly litigation, divert management’s attention and resources and subject the Company to significant liabilities. Management reviews all of the relevant facts for each claim and applies judgment in evaluating the likelihood and, if applicable, the amount of any potential loss. Where a potential loss is considered probable and the amount is reasonably estimable, provisions for loss are made based on management’s assessment of the likely outcome. Where a range of loss can be reasonably estimated with no best estimate in the range, the Company records the minimum amount in the range. The Company does not provide for claims for which the outcome is not probable or claims for which the amount of the loss cannot be reasonably estimated. Any settlements or awards under such claims are provided for when reasonably determinable. As of May 31, 2023, there are no material claims outstanding for which the Company has assessed the potential loss as both probable to result and reasonably estimable; therefore, no accrual has been made. Further, there are claims outstanding for which the Company has assessed the potential loss as reasonably possible to result; however, an estimate of the amount of loss cannot reasonably be made. There are many reasons that the Company cannot make these assessments, including, among others, one or more of the following: the early stages of a proceeding does not require the claimant to specifically identify the patent claims that have allegedly been infringed or the products that are alleged to infringe; damages sought are unspecified, unsupportable, unexplained or uncertain; discovery has not been started or is incomplete; the facts that are in dispute are highly complex; the difficulty of assessing novel claims; the parties have not engaged in any meaningful settlement discussions; the possibility that other parties may share in any ultimate liability; and the often slow pace of litigation. The Company has included the following summaries of certain of its legal proceedings though they do not meet the test for accrual described above. Between October and December 2013, several purported class action lawsuits and one individual lawsuit were filed against the Company and certain of its former officers in various jurisdictions in the U.S. and Canada alleging that the Company and certain of its officers made materially false and misleading statements regarding the Company’s financial condition and business prospects and that certain of the Company’s financial statements contain material misstatements. The individual lawsuit was voluntarily dismissed and the consolidated U.S. class actions was settled; see “Litigation Settlement” below in this Note 9. On July 23, 2014, the plaintiff in the putative Ontario class action ( Swisscanto Fondsleitung AG v. BlackBerry Limited, et al. ) filed a motion for class certification and for leave to pursue statutory misrepresentation claims. On November 17, 2015, the Ontario Superior Court of Justice issued an order granting the plaintiffs’ motion for leave to file a statutory claim for misrepresentation. On December 2, 2015, the Company filed a notice of motion seeking leave to appeal this ruling. On November 15, 2018, the Court denied the Company’s motion for leave to appeal the order granting the plaintiffs leave to file a statutory claim for misrepresentation. On February 5, 2019, the Court entered an order certifying a class comprised persons (a) who purchased BlackBerry common shares between March 28, 2013, and September 20, 2013, and still held at least some of those shares as of September 20, 2013, and (b) who acquired those shares on a Canadian stock exchange or acquired those shares on any other stock exchange and were a resident of Canada when the shares were acquired. Notice of class certification was published on March 6, 2019. The Company filed its Statement of Defence on April 1, 2019. Discovery is proceeding and the Court has not set a trial date. On March 17, 2017, a putative employment class action was filed against the Company in the Ontario Superior Court of Justice ( Parker v. BlackBerry Limited ). The Statement of Claim alleges that actions the Company took when certain of its employees decided to accept offers of employment from Ford Motor Company of Canada amounted to a wrongful termination of the employees’ employment with the Company. The claim seeks (i) an unspecified quantum of statutory, contractual, or common law termination entitlements; (ii) punitive or breach of duty of good faith damages of CAD$20 million, or such other amount as the Court finds appropriate, (iii) pre- and post- judgment interest, (iv) attorneys’ fees and costs, and (v) such other relief as the Court deems just. The Court granted the plaintiffs’ motion to certify the class action on May 27, 2019. The Company commenced a motion for leave to appeal the certification order on June 11, 2019. The Court denied the motion for leave to appeal on September 17, 2019. The Company filed its Statement of Defence on December 19, 2019. The parties participated in a mediation on November 9, 2022, which did not result in an agreement. Discovery is proceeding and the Court has not set a trial date. Other contingencies In the first quarter of fiscal 2019, the Board approved a compensation package for the Company’s Executive Chair and CEO as an incentive to remain as Executive Chair until November 23, 2023. As part of the package, the Company’s Executive Chair and CEO is entitled to receive a contingent performance-based cash award in the amount of $90 million that will become earned and payable should the volume weighted 10-day average trading price of the Company’s common shares on the New York Stock Exchange reach $30 before November 3, 2023. As the award is triggered by the Company’s share price, it is considered stock-based compensation and accounted for as a share-based liability award. As at May 31, 2023, the liability recorded in association with this award is nil (February 28, 2023 - nominal). As at May 31, 2023, the Company has recognized $17 million (February 28, 2023 - $17 million) in funds from claims filed with the Ministry of Innovation, Science and Economic Development Canada relating to its Strategic Innovation Fund program’s investment in BlackBerry QNX. A portion of this amount may be repayable in the future under certain circumstances if certain terms and conditions are not met by the Company, which is not probable at this time. (c) Litigation Settlement On April 6, 2022, through a mediator, the Company agreed in principle to pay $165 million to settle the U.S. consolidated actions (see “Litigation” above in this Note 9). The Stipulation of Settlement was executed effective June 7, 2022. On June 29, 2022, the Company paid $1 million of the settlement amount. The remaining $164 million was paid on September 6, 2022. On September 29, 2022, the Court granted final approval of the settlement and entered final judgment. (d) Indemnifications The Company enters into certain agreements that contain indemnification provisions under which the Company could be subject to costs and damages, including in the event of an infringement claim against the Company or an indemnified third party. Such intellectual property infringement indemnification clauses are generally not subject to any dollar limits and remain in effect for the term of the Company’s agreements. To date, the Company has not encountered material costs as a result of such indemnifications. |
Revenue and Segment Disclosures
Revenue and Segment Disclosures | 3 Months Ended |
May 31, 2023 | |
Segment Reporting [Abstract] | |
Revenue and Segment Disclosures | REVENUE AND SEGMENT DISCLOSURES The Company reports segment information 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 as a source of the Company’s reportable operating segments. The CODM, who is the Executive Chair and CEO of the Company, makes decisions and assesses the performance of the Company using three operating segments. The CODM does not evaluate operating segments using discrete asset information. The Company does not specifically allocate assets to operating segments for internal reporting purposes. Segment Disclosures The Company is organized and managed as three operating segments: Cybersecurity, IoT, and Licensing and Other. The following table shows information by operating segment for the three months ended May 31, 2023 and May 31, 2022: For the Three Months Ended Cybersecurity IoT Licensing and Other Segment Totals May 31, May 31, May 31, May 31, 2023 2022 2023 2022 2023 2022 2023 2022 Segment revenue $ 93 $ 113 $ 45 $ 51 $ 235 $ 4 $ 373 $ 168 Segment cost of sales 37 53 9 8 147 2 193 63 Segment gross margin (1) $ 56 $ 60 $ 36 $ 43 $ 88 $ 2 $ 180 $ 105 ______________________________ (1) A reconciliation of total segment gross margin to consolidated totals is set forth below. Cybersecurity consists of BlackBerry® UEM and Cylance® solutions (collectively BlackBerry Spark®), BlackBerry® AtHoc® and BlackBerry® SecuSUITE®. The Company’s Cylance artificial intelligence and machine learning-based platform consists of CylanceENDPOINT™, CylanceGUARD®, CylanceEDGE™, CylanceINTELLIGENCE™ and other cybersecurity applications. The BlackBerry UEM Suite includes the Company’s BlackBerry® UEM, BlackBerry® Dynamics™, and BlackBerry® Workspaces solutions. Cybersecurity revenue is generated predominantly through software licenses, commonly bundled with support, maintenance and professional services. IoT consists of BlackBerry® QNX®, BlackBerry® Certicom®, BlackBerry Radar®, BlackBerry IVY® and other IoT applications. IoT revenue is generated predominantly through software licenses, commonly bundled with support, maintenance and professional services. Licensing and Other consists of the Company’s intellectual property arrangements and settlement awards. Other consists of the Company’s legacy service access fees (“SAF”) business, which ceased operations on January 4, 2022. The following table reconciles total segment gross margin for the three months ended May 31, 2023 and May 31, 2022 to the Company’s consolidated totals: Three Months Ended May 31, 2023 May 31, 2022 Total segment gross margin $ 180 $ 105 Adjustments (1) : Less: Stock compensation 1 1 Less: Research & development 54 53 Selling, marketing and administration 99 82 Amortization 15 27 Debentures fair value adjustment 22 (46) Litigation settlement — 165 Investment income (loss), net (3) 1 Consolidated loss before income taxes $ (8) $ (178) ______________________________ (1) The CODM reviews segment information on an adjusted basis, which excludes certain amounts as described below: Stock compensation expenses - Equity compensation is a non-cash expense and does not impact the ongoing operating decisions taken by the Company’s management. Patent Sale On May 11, 2023, the Company completed its previously announced patent sale with Malikie and sold certain non-core patent assets for $170 million in cash on closing, an additional $30 million in fixed consideration due by no later than the third anniversary of closing and variable consideration in the form of future royalties in the aggregate amount of up to $700 million (the “Malikie Transaction”). Pursuant to the terms of the Malikie Transaction, the Company received a license back to the patents sold, which relate primarily to mobile devices, messaging and wireless networking. The Malikie Transaction will not impact customers’ right to use any of the Company’s products, solutions or services. In the first quarter of fiscal 2024, the Company recognized revenue of $218 million and cost of sales of $147 million related to intellectual property sold. The Company also recognized $1 million in other receivables, which has been included in accounts receivable on the Company’s balance sheets as at May 31, 2023 and $43 million in long-term receivables, which has been included in other long-term assets on the Company’s balance sheets as at May 31, 2023, relating to the $30 million in future cash to be paid no later than the third anniversary of closing and the future royalties that were not constrained as discussed below. The financing component recorded on the patent sale was $15 million and will be recognized as interest income over the payment terms. The Company estimated variable consideration from future royalty revenues using an expected value method including inputs from both internal and external sources related to patent monetization activities and cash flows, and constrained the recognition of that variable consideration based on the Company’s accounting policies and critical accounting estimates as described in Note 1. The present value of variable consideration recognized as revenue was $23 million and the amount of variable consideration constrained was $210 million. The Company evaluates its conclusions as to whether the constraints are still applicable on an ongoing basis, and will make updates when it observes a sufficient amount of evidence that amounts of variable consideration are no longer subject to constraint or the estimated amount of variable consideration has changed. Revenue The Company disaggregates revenue from contracts with customers based on geographical regions, timing of revenue recognition, and the major product and service types, as discussed above in “Segment Disclosures”. The Company’s revenue, classified by major geographic region in which the Company’s customers are located, was as follows: Three Months Ended May 31, 2023 May 31, 2022 North America (1) $ 317 $ 89 Europe, Middle East and Africa 37 60 Other regions 19 19 Total $ 373 $ 168 North America (1) 85.0 % 53.0 % Europe, Middle East and Africa 9.9 % 35.7 % Other regions 5.1 % 11.3 % Total 100.0 % 100.0 % ______________________________ (1) North America includes all revenue from the Company’s intellectual property arrangements, due to the global applicability of the patent portfolio and licensing arrangements thereof. Revenue, classified by timing of recognition, was as follows: Three Months Ended May 31, 2023 May 31, 2022 Products and services transferred over time $ 85 $ 97 Products and services transferred at a point in time 288 71 Total $ 373 $ 168 Revenue contract balances The following table sets forth the activity in the Company’s revenue contract balances for the three months ended May 31, 2023: Accounts and Other Receivable Deferred Revenue Deferred Commissions Opening balance as at February 28, 2023 $ 120 $ 215 $ 17 Increases due to invoicing of new or existing contracts, associated contract acquisition costs, or other 396 127 6 Decrease due to payment, fulfillment of performance obligations, or other (347) (139) (6) Increase (decrease), net 49 (12) — Closing balance as at May 31, 2023 $ 169 $ 203 $ 17 Transaction price allocated to the remaining performance obligations The table below discloses the aggregate amount of the transaction price allocated to performance obligations that are unsatisfied or partially unsatisfied as at May 31, 2023 and the time frame in which the Company expects to recognize this revenue. The disclosure includes estimates of variable consideration, except when the variable consideration is a sales-based or usage-based royalty promised in exchange for a license of intellectual property. The disclosure excludes estimates of variable consideration relating to future royalty revenues from the patent sale to Malikie, which have been constrained based on the Company’s accounting policies and critical accounting estimates as described in Note 1 and under “Patent Sale” in this Note 10. As at May 31, 2023 Less than 12 Months 12 to 24 Months Thereafter Total Remaining performance obligations $ 177 $ 11 $ 15 $ 203 Revenue recognized for performance obligations satisfied in prior periods For the three months ended May 31, 2023, $9 million of revenue was recognized relating to performance obligations satisfied in a prior period as a result of certain variable consideration no longer being subject to constraint (three months ended May 31, 2022 - nil). Property, plant and equipment, intangible assets, operating lease ROU assets and goodwill, classified by geographic region in which the Company’s assets are located, were as follows: As at May 31, 2023 February 28, 2023 Property, Plant and Equipment, Intangible Assets, Operating Lease ROU Assets and Goodwill Total Assets Property, Plant and Equipment, Intangible Assets, Operating Lease ROU Assets and Goodwill Total Assets Canada $ 94 $ 323 $ 98 $ 375 United States 735 1,262 742 1,208 Other 27 89 27 96 $ 856 $ 1,674 $ 867 $ 1,679 Information About Major Customers |
Cash Flow and Additional Inform
Cash Flow and Additional Information | 3 Months Ended |
May 31, 2023 | |
Supplemental Cash Flow Information [Abstract] | |
Cash Flow and Additional Information | CASH FLOW AND ADDITIONAL INFORMATION (a) Certain consolidated statements of cash flow information related to interest and income taxes paid is summarized as follows: Three Months Ended May 31, 2023 May 31, 2022 Interest paid during the period $ 2 $ 2 Income taxes paid during the period 2 1 Income tax refunds received during the period — — (b) Additional Information Foreign exchange The Company is exposed to foreign exchange risk as a result of transactions in currencies other than its functional currency, the U.S. dollar. The majority of the Company’s revenue in the first quarter of fiscal 2024 was transacted in U.S. dollars. Portions of the revenue were denominated in Canadian dollars, euros and British pounds. Other expenses, consisting mainly of salaries and certain other operating costs, were incurred primarily in Canadian dollars, but were also incurred in U.S. dollars, euros and British pounds. At May 31, 2023, approximately 21% of cash and cash equivalents, 35% of accounts receivable and 38% of accounts payable were denominated in foreign currencies (February 28, 2023 – 19%, 24% and 36%, respectively). These foreign currencies primarily include the Canadian dollar, euro and British pound. As part of its risk management strategy, the Company maintains net monetary asset and/or liability balances in foreign currencies and engages in foreign currency hedging activities using derivative financial instruments, including currency forward contracts and currency options. The Company does not use derivative instruments for speculative purposes. Interest rate risk Cash and cash equivalents and investments are invested in certain instruments of varying maturities. Consequently, the Company is exposed to interest rate risk as a result of holding investments of varying maturities. The fair value of investments, as well as the investment income derived from the investment portfolio, will fluctuate with changes in prevailing interest rates. The Company has also issued Debentures with a fixed interest rate, as described in Note 5. The fair value of the Debentures will fluctuate with changes in prevailing interest rates. Consequently, the Company is exposed to interest rate risk as a result of the Debentures. The Company does not currently utilize interest rate derivative instruments to hedge its investment portfolio or changes in the market value of the Debentures. Credit risk The Company is exposed to market and credit risk on its investment portfolio. The Company reduces this risk by investing in liquid, investment-grade securities and by limiting exposure to any one entity or group of related entities. As at May 31, 2023, no single issuer represented more than 18% of the total cash, cash equivalents and investments (February 28, 2023 - no single issuer represented more than 12% of the total cash, cash equivalents and investments), with the largest such issuer representing bearer deposits, term deposits and cash balances with one of the Company’s banking counterparties. The Company maintains Credit Support Annexes (“CSAs”) with several of its counterparties. These CSAs require the outstanding net position of all contracts be made whole by the paying or receiving of collateral to or from the counterparties on a daily basis, subject to exposure and transfer thresholds. As at May 31, 2023, the Company had $1 million in collateral posted with counterparties (February 28, 2023 - $1 million in collateral held). Liquidity risk Cash, cash equivalents, and investments were approximately $578 million as at May 31, 2023. The Company’s management remains focused on efficiently managing working capital balances and managing the liquidity needs of the business. The Company has experienced recent operating losses and the Debentures will mature on November 13, 2023 as described above in Note 5, but the Company has the ability to access other potential financing arrangements on commercially reasonable terms. Taking these factors into account and based on its current financial projections, the Company believes its financial resources, together with expected future operating cash generating and operating expense reduction activities and access to other potential financing arrangements, should be sufficient to meet funding requirements for current financial commitments and future operating expenditures not yet committed, and should provide the necessary financial capacity for the foreseeable future. Government subsidies During the third quarter of fiscal 2022, the Government of Canada announced the Hardest-Hit Business Recovery Program (“HHBRP”) to continue supporting businesses affected by the COVID-19 pandemic. The HHBRP provided a subsidy of up to 50% of eligible employees’ employment insurable remuneration, subject to certain criteria, and rent and ran until May 7, 2022. other receivables |
Blackberry Limited and Summar_2
Blackberry Limited and Summary of Significant Accounting Policies and Critical Accounting Estimates (Policies) | 3 Months Ended |
May 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of presentation and preparation | Basis of Presentation and Preparation These interim consolidated financial statements have been prepared by management in accordance with United States generally accepted accounting principles (“U.S. GAAP”). They do not include all of the disclosures required by U.S. GAAP for annual financial statements and should be read in conjunction with the audited consolidated financial statements of BlackBerry Limited (the “Company”) for the year ended February 28, 2023 (the “Annual Financial Statements”), which have been prepared in accordance with U.S. GAAP. In the opinion of management, all normal recurring adjustments considered necessary for fair presentation have been included in these interim consolidated financial statements. Operating results for the three months ended May 31, 2023 are not necessarily indicative of the results that may be expected for the full year ending February 29, 2024. The consolidated balance sheet at February 28, 2023 was derived from the audited Annual Financial Statements but does not contain all of the footnote disclosures from the Annual Financial Statements. The preparation of the consolidated financial statements requires management to make estimates and assumptions with respect to the reported amounts of assets, liabilities, revenue and expenses and the disclosure of contingent assets and liabilities. Actual results could differ from these estimates and any such differences may be material to the Company’s consolidated financial statements. Certain of the comparative figures have been reclassified to conform to the current period’s presentation. The Company is organized and managed as three reportable operating segments: Cybersecurity, IoT (collectively, “Software & Services”), and Licensing and Other, as further discussed in Note 10. |
Use of estimates | Significant Accounting Policies and Critical Accounting Estimates There have been no material changes to the Company’s accounting policies or critical accounting estimates from those described in the Annual Financial Statements other than those noted below. Critical Accounting Estimates during the Quarter (Note 10) To the extent the transaction price in a contract with a customer includes variable consideration, the Company estimates the amount of variable consideration that should be included in the price utilizing either the expected value method or the most likely amount method, depending on the nature of the variable consideration. The Company also estimates whether and how much variable consideration is subject to constraint if it cannot conclude it is probable that a significant reversal in revenue will not occur, due to factors such as: the consideration being highly susceptible to factors outside the Company’s influence, the period of time before the variable consideration is resolved, the Company’s previous experience with similar contracts, the Company’s history of price concessions or changing of payment terms, and whether there is a large number and broad range of possible variable consideration amounts. To the extent the Company determines that there is a significant financing component in a contract with a customer, it determines the impact of the time value of money in adjusting the transaction price to account for the income associated with the financing component by estimating the discount rate that would be reflected in a separate financing transaction between the customer and the Company at contract inception, based upon the credit characteristics of the customer receiving financing in the contract. |
New Accounting Pronouncements | Accounting Standards Adopted During Fiscal 2024The Company has not adopted any new standards to date during fiscal 2024. |
Fair Value Measurements, Cash_2
Fair Value Measurements, Cash, Cash Equivalent and Investments (Tables) | 3 Months Ended |
May 31, 2023 | |
Cash and Cash Equivalents [Abstract] | |
Components of Cash, Cash Equivalents and Investments | The components of cash, cash equivalents and investments by fair value level as at May 31, 2023 were as follows: Cost Basis (1) Unrealized Unrealized Fair Value Cash and Short-term Long-term Restricted Cash and Cash Equivalents Bank balances $ 85 $ — $ — $ 85 $ 83 $ — $ — $ 2 Other investments 29 6 — 35 — — 35 — 114 6 — 120 83 — 35 2 Level 1: Equity securities 10 — (10) — — — — — Level 2: Term deposits and certificates of deposits 53 — — 53 31 — — 22 Bankers’ acceptances/bearer deposit notes 106 — — 106 106 — — — Commercial paper 172 — — 172 84 85 — 3 Non-U.S. promissory notes 83 — — 83 32 51 — — Non-U.S. treasury bills/notes 22 — — 22 22 — — — Corporate notes/bonds 22 — — 22 — 22 — — 458 — — 458 275 158 — 25 $ 582 $ 6 $ (10) $ 578 $ 358 $ 158 $ 35 $ 27 ______________________________ (1) Cost basis for other investments includes the effect of returns of capital and impairment. The components of cash, cash equivalents and investments by fair value level as at February 28, 2023 were as follows: Cost Basis (1) Unrealized Unrealized Fair Value Cash and Short-term Long-term Restricted Cash and Cash Equivalents Bank balances $ 89 $ — $ — $ 89 $ 87 $ — $ — $ 2 Other investments 26 2 — 28 — — 28 — 115 2 — 117 87 — 28 2 Level 1: Equity securities 10 — (10) — — — — — Level 2: Term deposits, and certificates of deposits 33 — — 33 8 — — 25 Bearer deposit notes 82 — — 82 82 — — — Commercial paper 159 — — 159 108 51 — — Non-U.S. promissory notes 45 — — 45 — 45 — — Non-U.S. government sponsored enterprise notes 30 — — 30 10 20 — — Corporate notes/bonds 15 — — 15 — 15 — — 364 — — 364 208 131 — 25 Level 3: Other investments 2 4 — 6 — — 6 — $ 491 $ 6 $ (10) $ 487 $ 295 $ 131 $ 34 $ 27 ______________________________ (1) Cost basis for other investments includes the effect of returns of capital and impairment. |
Schedule of Cash and Cash Equivalents | The following table provides a reconciliation of cash, cash equivalents, restricted cash, and restricted cash equivalents as at May 31, 2023 and February 28, 2023 from the consolidated balance sheets to the consolidated statements of cash flows: As at May 31, 2023 February 28, 2023 Cash and cash equivalents $ 358 $ 295 Restricted cash and cash equivalents 27 27 Total cash, cash equivalents, restricted cash, and restricted cash equivalents presented in the consolidated statements of cash flows $ 385 $ 322 |
Contractual Maturities of Available-for-Sale Investments | The contractual maturities of available-for-sale investments as at May 31, 2023 and February 28, 2023 were as follows: As at May 31, 2023 February 28, 2023 Cost Basis Fair Value Cost Basis Fair Value Due in one year or less $ 458 $ 458 $ 364 $ 364 No fixed maturity 10 — 10 — $ 468 $ 458 $ 374 $ 364 |
Consolidated Balance Sheets D_2
Consolidated Balance Sheets Details (Tables) | 3 Months Ended |
May 31, 2023 | |
Balance Sheet Related Disclosures [Abstract] | |
Accounts Receivable, Allowance for Credit Loss | The following table sets forth the activity in the Company’s allowance for credit losses: Carrying Amount Beginning balance as of February 28, 2022 $ 4 Prior period provision for expected credit losses 1 Write-offs charged against the allowance (4) Ending balance of the allowance for credit loss as at February 28, 2023 1 Current period provision for expected credit losses 5 Ending balance of the allowance for credit loss as at May 31, 2023 $ 6 The allowance for credit losses as at May 31, 2023 consists of $2 million (February 28, 2023 - $1 million) relating to CECL estimated based on days past due and region and $4 million (February 28, 2023 - nil) relating to specific customers that were evaluated separately. |
Schedule of Other Current Assets | Other current assets comprised the following: As at May 31, 2023 February 28, 2023 Intellectual property $ — $ 141 Other 52 41 $ 52 $ 182 |
Property, Plant and Equipment | Property, plant and equipment comprised the following: As at May 31, 2023 February 28, 2023 Cost BlackBerry operations and other information technology $ 85 $ 84 Leasehold improvements and other 19 19 Furniture and fixtures 9 9 Manufacturing, repair and research and development equipment 2 2 115 114 Accumulated amortization 91 89 Net book value $ 24 $ 25 |
Intangible Assets | Intangible assets comprised the following: As at May 31, 2023 Cost Accumulated Net Book Acquired technology $ 900 $ 830 $ 70 Other acquired intangibles 386 322 64 Intellectual property 124 66 58 $ 1,410 $ 1,218 $ 192 As at February 28, 2023 Cost Accumulated Net Book Acquired technology $ 900 $ 824 $ 76 Other acquired intangibles 386 318 68 Intellectual property 123 64 59 $ 1,409 $ 1,206 $ 203 |
Changes to Carrying Amount of Goodwill | Changes to the carrying amount of goodwill during the three months ended May 31, 2023 were as follows: Carrying Amount Carrying amount as at February 28, 2022 $ 844 Goodwill impairment charge (245) Effect of foreign exchange on non-U.S. dollar denominated goodwill (4) Carrying amount as at February 28, 2023 595 Effect of foreign exchange on non-U.S. dollar denominated goodwill 1 Carrying amount as at May 31, 2023 $ 596 |
Debentures (Tables)
Debentures (Tables) | 3 Months Ended |
May 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Debentures | The following table summarizes the change in fair value of the Debentures for the three months ended May 31, 2023, which also represents the total changes through earnings of items classified as Level 3 in the fair value hierarchy: As at May 31, 2023 Balance as at February 28, 2023 $ 367 Change in fair value of the Debentures 22 Balance as at May 31, 2023 $ 389 |
1.75% Debenture - impact of changes in fair value | The following table shows the impact of the changes in fair value of the Debentures for the three months ended May 31, 2023 and May 31, 2022: Three Months Ended May 31, 2023 May 31, 2022 Income (charge) associated with the change in fair value from non-credit components recorded in the consolidated statements of operations $ (22) $ 46 Income associated with the change in fair value from instrument-specific credit components recorded in AOCL — 2 Total decrease (increase) in the fair value of the Debentures $ (22) $ 48 |
Capital Stock (Tables)
Capital Stock (Tables) | 3 Months Ended |
May 31, 2023 | |
Share-Based Payment Arrangement, Noncash Expense [Abstract] | |
Changes in Issued and Outstanding Common Shares | The following details the changes in issued and outstanding common shares for the three months ended May 31, 2023: Capital Stock and Stock Amount Common shares outstanding as at February 28, 2023 582,157 $ 2,909 Exercise of stock options 52 — Common shares issued for restricted share unit settlements 461 — Stock-based compensation — 9 Common shares issued for employee share purchase plan 567 2 Common shares outstanding as at May 31, 2023 583,237 $ 2,920 |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 3 Months Ended |
May 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Earnings Per Share | The following table sets forth the computation of basic and diluted loss per share: Three Months Ended May 31, 2023 May 31, 2022 Net loss for basic loss per share available to common shareholders $ (11) $ (181) Less: Debentures fair value adjustment (1) (2) — (46) Add: interest expense on Debentures (1) (2) — 2 Net loss for diluted loss per share available to common shareholders $ (11) $ (225) Weighted average number of shares outstanding (000’s) - basic (3) 582,812 576,877 Effect of dilutive securities (000’s) Conversion of Debentures (1) (2) — 60,833 Weighted average number of shares and assumed conversions (000’s) diluted 582,812 637,710 Loss per share - reported Basic $ (0.02) $ (0.31) Diluted $ (0.02) $ (0.35) ______________________________ (1) The Company has presented the dilutive effect of the Debentures using the if-converted method, assuming conversion at the beginning of the quarter for the three months ended May 31, 2022. Accordingly, to calculate diluted loss per share, the Company adjusted net loss by eliminating the fair value adjustment made to the Debentures and interest expense incurred on the Debentures for the three months ended May 31, 2022, and added the number of shares that would have been issued upon conversion to the diluted weighted average number of shares outstanding. See Note 5 for details on the Debentures. (2) The Company has not presented the dilutive effect of the Debentures using the if-converted method in the calculation of diluted loss per share for the three months ended May 31, 2023, as to do so would be antidilutive. See Note 5 for details on the Debentures. (3) The Company has not presented the dilutive effect of in-the-money options and RSUs that will be settled upon vesting by the issuance of new common shares in the calculation of diluted loss per share for the three months ended May 31, 2023 and May 31, 2022, as to do so would be antidilutive. |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 3 Months Ended |
May 31, 2023 | |
Equity [Abstract] | |
Components of Accumulated Other Comprehensive Loss | The changes in AOCL by component net of tax, for the three months ended May 31, 2023 and May 31, 2022 were as follows: Three Months Ended May 31, 2023 May 31, 2022 Cash Flow Hedges Balance, beginning of period $ (1) $ — Other comprehensive income before reclassification — 1 Amounts reclassified from AOCL into net loss 1 — Accumulated net unrealized gains on derivative instruments designated as cash flow hedges $ — $ 1 Foreign Currency Cumulative Translation Adjustment Balance, beginning of period $ (16) $ (10) Other comprehensive income (loss) 1 (4) Foreign currency cumulative translation adjustment $ (15) $ (14) Change in Fair Value From Instrument-Specific Credit Risk On Debentures Balance, beginning of period $ (6) $ (8) Other comprehensive income before reclassification — 2 Change in fair value from instruments-specific credit risk on Debentures $ (6) $ (6) Other Post-Employment Benefit Obligations Actuarial losses associated with other post-employment benefit obligations $ (1) $ (1) Accumulated Other Comprehensive Loss, End of Period $ (22) $ (20) |
Revenue and Segment Disclosure
Revenue and Segment Disclosure (Tables) | 3 Months Ended |
May 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | The following table shows information by operating segment for the three months ended May 31, 2023 and May 31, 2022: For the Three Months Ended Cybersecurity IoT Licensing and Other Segment Totals May 31, May 31, May 31, May 31, 2023 2022 2023 2022 2023 2022 2023 2022 Segment revenue $ 93 $ 113 $ 45 $ 51 $ 235 $ 4 $ 373 $ 168 Segment cost of sales 37 53 9 8 147 2 193 63 Segment gross margin (1) $ 56 $ 60 $ 36 $ 43 $ 88 $ 2 $ 180 $ 105 ______________________________ (1) A reconciliation of total segment gross margin to consolidated totals is set forth below. |
Reconciliation of Operating Profit (Loss) from Segments to Consolidated | The following table reconciles total segment gross margin for the three months ended May 31, 2023 and May 31, 2022 to the Company’s consolidated totals: Three Months Ended May 31, 2023 May 31, 2022 Total segment gross margin $ 180 $ 105 Adjustments (1) : Less: Stock compensation 1 1 Less: Research & development 54 53 Selling, marketing and administration 99 82 Amortization 15 27 Debentures fair value adjustment 22 (46) Litigation settlement — 165 Investment income (loss), net (3) 1 Consolidated loss before income taxes $ (8) $ (178) ______________________________ (1) The CODM reviews segment information on an adjusted basis, which excludes certain amounts as described below: |
Revenue from External Customers by Geographic Areas | The Company’s revenue, classified by major geographic region in which the Company’s customers are located, was as follows: Three Months Ended May 31, 2023 May 31, 2022 North America (1) $ 317 $ 89 Europe, Middle East and Africa 37 60 Other regions 19 19 Total $ 373 $ 168 North America (1) 85.0 % 53.0 % Europe, Middle East and Africa 9.9 % 35.7 % Other regions 5.1 % 11.3 % Total 100.0 % 100.0 % ______________________________ (1) North America includes all revenue from the Company’s intellectual property arrangements, due to the global applicability of the patent portfolio and licensing arrangements thereof. |
Revenue Classified by Timing of Recognition | Revenue, classified by timing of recognition, was as follows: Three Months Ended May 31, 2023 May 31, 2022 Products and services transferred over time $ 85 $ 97 Products and services transferred at a point in time 288 71 Total $ 373 $ 168 |
Revenue Contract Balances | The following table sets forth the activity in the Company’s revenue contract balances for the three months ended May 31, 2023: Accounts and Other Receivable Deferred Revenue Deferred Commissions Opening balance as at February 28, 2023 $ 120 $ 215 $ 17 Increases due to invoicing of new or existing contracts, associated contract acquisition costs, or other 396 127 6 Decrease due to payment, fulfillment of performance obligations, or other (347) (139) (6) Increase (decrease), net 49 (12) — Closing balance as at May 31, 2023 $ 169 $ 203 $ 17 |
Transaction Price Allocated to the Remaining Performance Obligation | The table below discloses the aggregate amount of the transaction price allocated to performance obligations that are unsatisfied or partially unsatisfied as at May 31, 2023 and the time frame in which the Company expects to recognize this revenue. The disclosure includes estimates of variable consideration, except when the variable consideration is a sales-based or usage-based royalty promised in exchange for a license of intellectual property. The disclosure excludes estimates of variable consideration relating to future royalty revenues from the patent sale to Malikie, which have been constrained based on the Company’s accounting policies and critical accounting estimates as described in Note 1 and under “Patent Sale” in this Note 10. As at May 31, 2023 Less than 12 Months 12 to 24 Months Thereafter Total Remaining performance obligations $ 177 $ 11 $ 15 $ 203 |
Long-lived Assets and Total Assets by Geographic Areas | Property, plant and equipment, intangible assets, operating lease ROU assets and goodwill, classified by geographic region in which the Company’s assets are located, were as follows: As at May 31, 2023 February 28, 2023 Property, Plant and Equipment, Intangible Assets, Operating Lease ROU Assets and Goodwill Total Assets Property, Plant and Equipment, Intangible Assets, Operating Lease ROU Assets and Goodwill Total Assets Canada $ 94 $ 323 $ 98 $ 375 United States 735 1,262 742 1,208 Other 27 89 27 96 $ 856 $ 1,674 $ 867 $ 1,679 |
Cash Flow and Additional Info_2
Cash Flow and Additional Information (Tables) | 3 Months Ended |
May 31, 2023 | |
Supplemental Cash Flow Information [Abstract] | |
Supplemental Cash Flow Information | (a) Certain consolidated statements of cash flow information related to interest and income taxes paid is summarized as follows: Three Months Ended May 31, 2023 May 31, 2022 Interest paid during the period $ 2 $ 2 Income taxes paid during the period 2 1 Income tax refunds received during the period — — |
Cash, Cash Equivalents and Inve
Cash, Cash Equivalents and Investments - Components of Cash, Cash Equivalents and Investments (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
May 31, 2023 | Feb. 28, 2023 | |||
Cash, Cash Equivalents and Investments [Line Items] | ||||
Cost Basis | $ 582 | $ 491 | ||
Unrealized Gains | 6 | 6 | ||
Unrealized Losses | (10) | (10) | ||
Fair Value | 578 | 487 | ||
Cash and cash equivalents (note 2) | 358 | 295 | ||
Short-term Investments | 158 | 131 | ||
Long-term investments (note 2) | 35 | 34 | ||
Restricted Cash and Cash Equivalents | 27 | 27 | ||
Bank balances | ||||
Cash, Cash Equivalents and Investments [Line Items] | ||||
Cost Basis | 85 | 89 | ||
Unrealized Gains | 0 | 0 | ||
Unrealized Losses | 0 | 0 | ||
Fair Value | 85 | 89 | ||
Cash and cash equivalents (note 2) | 83 | 87 | ||
Short-term Investments | 0 | 0 | ||
Long-term investments (note 2) | 0 | 0 | ||
Restricted Cash and Cash Equivalents | 2 | 2 | ||
Other investments | ||||
Cash, Cash Equivalents and Investments [Line Items] | ||||
Cost Basis | 29 | [1] | 26 | [2] |
Unrealized Gains | 6 | 2 | ||
Unrealized Losses | 0 | 0 | ||
Fair Value | 35 | 28 | ||
Cash and cash equivalents (note 2) | 0 | 0 | ||
Short-term Investments | 0 | 0 | ||
Long-term investments (note 2) | 35 | 28 | ||
Restricted Cash and Cash Equivalents | 0 | 0 | ||
Bank Balances and Other Investments [Domain] | ||||
Cash, Cash Equivalents and Investments [Line Items] | ||||
Cost Basis | 114 | 115 | ||
Unrealized Gains | 6 | 2 | ||
Unrealized Losses | 0 | 0 | ||
Fair Value | 120 | 117 | ||
Cash and cash equivalents (note 2) | 83 | 87 | ||
Short-term Investments | 0 | 0 | ||
Long-term investments (note 2) | 35 | 28 | ||
Restricted Cash and Cash Equivalents | 2 | 2 | ||
Level 1: | Equity securities | ||||
Cash, Cash Equivalents and Investments [Line Items] | ||||
Cost Basis | 10 | 10 | ||
Equity Securities, FV-NI, Unrealized Gain | 0 | 0 | ||
Equity Securities, FV-NI, Unrealized Loss | (10) | (10) | ||
Fair Value | 0 | 0 | ||
Cash and cash equivalents (note 2) | 0 | 0 | ||
Short-term Investments | 0 | 0 | ||
Long-term investments (note 2) | 0 | 0 | ||
Restricted Cash and Cash Equivalents | 0 | 0 | ||
Level 2: | ||||
Cash, Cash Equivalents and Investments [Line Items] | ||||
Cost Basis | 458 | 364 | ||
Debt Securities, Available-for-Sale, Unrealized Gain | 0 | 0 | ||
Debt Securities, Available-for-Sale, Unrealized Loss | 0 | 0 | ||
Fair Value | 458 | 364 | ||
Cash and cash equivalents (note 2) | 275 | 208 | ||
Short-term Investments | 158 | 131 | ||
Long-term investments (note 2) | 0 | 0 | ||
Restricted Cash and Cash Equivalents | 25 | 25 | ||
Level 2: | Term deposits, and certificates of deposits | ||||
Cash, Cash Equivalents and Investments [Line Items] | ||||
Cost Basis | 53 | 33 | ||
Debt Securities, Available-for-Sale, Unrealized Gain | 0 | 0 | ||
Debt Securities, Available-for-Sale, Unrealized Loss | 0 | 0 | ||
Fair Value | 53 | 33 | ||
Cash and cash equivalents (note 2) | 31 | 8 | ||
Short-term Investments | 0 | 0 | ||
Long-term investments (note 2) | 0 | 0 | ||
Restricted Cash and Cash Equivalents | 22 | 25 | ||
Level 2: | Bankers’ acceptances/bearer deposit notes | ||||
Cash, Cash Equivalents and Investments [Line Items] | ||||
Cost Basis | 106 | 82 | ||
Debt Securities, Available-for-Sale, Unrealized Gain | 0 | 0 | ||
Debt Securities, Available-for-Sale, Unrealized Loss | 0 | 0 | ||
Fair Value | 106 | 82 | ||
Cash and cash equivalents (note 2) | 106 | 82 | ||
Short-term Investments | 0 | 0 | ||
Long-term investments (note 2) | 0 | 0 | ||
Restricted Cash and Cash Equivalents | 0 | 0 | ||
Level 2: | Commercial paper | ||||
Cash, Cash Equivalents and Investments [Line Items] | ||||
Cost Basis | 172 | 159 | ||
Debt Securities, Available-for-Sale, Unrealized Gain | 0 | 0 | ||
Debt Securities, Available-for-Sale, Unrealized Loss | 0 | 0 | ||
Fair Value | 172 | 159 | ||
Cash and cash equivalents (note 2) | 84 | 108 | ||
Short-term Investments | 85 | 51 | ||
Long-term investments (note 2) | 0 | 0 | ||
Restricted Cash and Cash Equivalents | 3 | 0 | ||
Level 2: | Non-U.S. promissory notes | ||||
Cash, Cash Equivalents and Investments [Line Items] | ||||
Cost Basis | 83 | 45 | ||
Debt Securities, Available-for-Sale, Unrealized Gain | 0 | 0 | ||
Debt Securities, Available-for-Sale, Unrealized Loss | 0 | 0 | ||
Fair Value | 83 | 45 | ||
Cash and cash equivalents (note 2) | 32 | 0 | ||
Short-term Investments | 51 | 45 | ||
Long-term investments (note 2) | 0 | 0 | ||
Restricted Cash and Cash Equivalents | 0 | 0 | ||
Level 2: | Non-U.S. government sponsored enterprise notes | ||||
Cash, Cash Equivalents and Investments [Line Items] | ||||
Cost Basis | 30 | |||
Debt Securities, Available-for-Sale, Unrealized Gain | 0 | |||
Debt Securities, Available-for-Sale, Unrealized Loss | 0 | |||
Fair Value | 30 | |||
Cash and cash equivalents (note 2) | 10 | |||
Short-term Investments | 20 | |||
Long-term investments (note 2) | 0 | |||
Restricted Cash and Cash Equivalents | 0 | |||
Level 2: | Non-U.S. treasury bills/notes | ||||
Cash, Cash Equivalents and Investments [Line Items] | ||||
Cost Basis | 22 | |||
Debt Securities, Available-for-Sale, Unrealized Gain | 0 | |||
Debt Securities, Available-for-Sale, Unrealized Loss | 0 | |||
Fair Value | 22 | |||
Cash and cash equivalents (note 2) | 22 | |||
Short-term Investments | 0 | |||
Long-term investments (note 2) | 0 | |||
Restricted Cash and Cash Equivalents | 0 | |||
Level 2: | Corporate notes/bonds | ||||
Cash, Cash Equivalents and Investments [Line Items] | ||||
Cost Basis | 22 | 15 | ||
Debt Securities, Available-for-Sale, Unrealized Gain | 0 | 0 | ||
Debt Securities, Available-for-Sale, Unrealized Loss | 0 | 0 | ||
Fair Value | 22 | 15 | ||
Cash and cash equivalents (note 2) | 0 | 0 | ||
Short-term Investments | 22 | 15 | ||
Long-term investments (note 2) | 0 | 0 | ||
Restricted Cash and Cash Equivalents | $ 0 | 0 | ||
Level 3: | Other investments | ||||
Cash, Cash Equivalents and Investments [Line Items] | ||||
Cost Basis | 2 | |||
Equity Securities without Readily Determinable Fair Value, Upward Price Adjustment, Annual Amount | 4 | |||
Equity Securities without Readily Determinable Fair Value, Downward Price Adjustment, Annual Amount | 0 | |||
Fair Value | 6 | |||
Cash and cash equivalents (note 2) | 0 | |||
Short-term Investments | 0 | |||
Long-term investments (note 2) | 6 | |||
Restricted Cash and Cash Equivalents | $ 0 | |||
[1]Cost basis for other investments includes the effect of returns of capital and impairment.[2]Cost basis for other investments includes the effect of returns of capital and impairment. |
Cash, Cash Equivalents and In_2
Cash, Cash Equivalents and Investments - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | ||
May 31, 2023 | May 31, 2022 | Feb. 28, 2023 | |
Cash, Cash Equivalents and Investments [Line Items] | |||
Investments that are communicated to the third party for consideration of reasonableness, threshold limit for fair values | 0.50% | ||
Equity Securities without Readily Determinable Fair Value, Amount | $ 35 | $ 34 | |
Debt Securities, Available-for-sale, Realized Gain (Loss) | 0 | $ 0 | |
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer | 0 | 0 | |
Equity Securities without Readily Determinable Fair Value, Impairment Loss, Cumulative Amount | $ 3 | $ 3 | |
Minimum | |||
Cash, Cash Equivalents and Investments [Line Items] | |||
Letters of credit terms | 1 month | ||
Maximum | |||
Cash, Cash Equivalents and Investments [Line Items] | |||
Letters of credit terms | 2 years |
Cash, Cash Equivalent, Restrict
Cash, Cash Equivalent, Restricted Cash, and Restricted Cash Equivalent Presented in the Consolidated Statements of Cash Flow (Details) - USD ($) $ in Millions | May 31, 2023 | Feb. 28, 2023 | May 31, 2022 | Feb. 28, 2022 |
Cash and Cash Equivalents [Abstract] | ||||
Cash and cash equivalents (note 2) | $ 358 | $ 295 | ||
Restricted Cash and Cash Equivalents | 27 | 27 | ||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Total | $ 385 | $ 322 | $ 419 | $ 406 |
Cash, Cash Equivalents and In_3
Cash, Cash Equivalents and Investments - Contractual Maturities of Available-for-Sale Investments (Details) - USD ($) $ in Millions | May 31, 2023 | Feb. 28, 2023 |
Cost Basis | ||
Due in one year or less | $ 458 | $ 364 |
No fixed maturity | 10 | 10 |
Total | 468 | 374 |
Fair Value | ||
Due in one year or less | 458 | 364 |
No fixed maturity | 0 | 0 |
Total | $ 458 | $ 364 |
Consolidated Balance Sheets D_3
Consolidated Balance Sheets Details - Accounts Receivable (Details) $ in Millions | 3 Months Ended | 12 Months Ended |
May 31, 2023 USD ($) | Feb. 28, 2023 USD ($) | |
Balance Sheet Related Disclosures [Abstract] | ||
Accounts Receivable, Allowance for Credit Loss, Relating to CECL Estimated Based on Days Past Due and Region | $ 2 | $ 1 |
Accounts Receivable, Allowance for Credit Loss, Relating to Customers Evaluated Separately | $ 4 | $ 0 |
Number of customers with a balance greater than 10% of total accounts receivable | 1 | 2 |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Accounts Receivable, Allowance for Credit Loss, Beginning Balance | $ 1 | $ 4 |
Current period provision for expected credit losses | 5 | 1 |
Accounts Receivable, Allowance for Credit Loss, Writeoff | (4) | |
Accounts Receivable, Allowance for Credit Loss, Ending Balance | $ 6 | $ 1 |
Consolidated Balance Sheets D_4
Consolidated Balance Sheets Details - Other Current Assets (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
May 31, 2023 | May 31, 2022 | Feb. 28, 2023 | |
Condensed Balance Sheet Statements, Captions [Line Items] | |||
Intellectual Property included in Other Current Assets | $ 0 | $ 141 | |
Other Current Assets - Other Amounts | 52 | 41 | |
Other current assets (note 3) | $ 52 | $ 182 | |
Other current assets greater than five percent of current assets | none | none | |
Patent maintenance on intellectual property sold | $ 6 | ||
Revenue recognized on patent sale | 218 | ||
Intellectual property disposed of by sale | $ 147 | $ 0 | |
Other Long-Term Assets Greater than Five Percent of Total Assets | none | none |
Consolidated Balance Sheets D_5
Consolidated Balance Sheets Detail - Property, Plant and Equipment (Details) - USD ($) $ in Millions | May 31, 2023 | Feb. 28, 2023 |
Property, Plant and Equipment [Line Items] | ||
Cost of property, plant and equipment | $ 115 | $ 114 |
Accumulated amortization | 91 | 89 |
Net book value | 24 | 25 |
BlackBerry operations and other information technology | ||
Property, Plant and Equipment [Line Items] | ||
Cost of property, plant and equipment | 85 | 84 |
Leasehold improvements and other | ||
Property, Plant and Equipment [Line Items] | ||
Cost of property, plant and equipment | 19 | 19 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Cost of property, plant and equipment | 9 | 9 |
Manufacturing, repair and research and development equipment | ||
Property, Plant and Equipment [Line Items] | ||
Cost of property, plant and equipment | $ 2 | $ 2 |
Consolidated Balance Sheets D_6
Consolidated Balance Sheets Detail - Intangible Assets (Details) - USD ($) $ in Millions | 3 Months Ended | ||
May 31, 2023 | May 31, 2022 | Feb. 28, 2023 | |
Finite-Lived Intangible Assets [Line Items] | |||
Cost | $ 1,410 | $ 1,409 | |
Accumulated Amortization | 1,218 | 1,206 | |
Net Book Value | 192 | 203 | |
Amortization expenses related to intangible assets | 13 | $ 25 | |
Payments to Acquire Intangible Asset Held | (2) | ||
Payments to Acquire Intangible Assets | (8) | $ (8) | |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |||
2024 | 35 | ||
2025 | 41 | ||
2026 | 37 | ||
2027 | 32 | ||
2028 | 19 | ||
2029 | 6 | ||
Acquired technology | |||
Finite-Lived Intangible Assets [Line Items] | |||
Cost | 900 | 900 | |
Accumulated Amortization | 830 | 824 | |
Net Book Value | 70 | 76 | |
Other acquired intangibles | |||
Finite-Lived Intangible Assets [Line Items] | |||
Cost | 386 | 386 | |
Accumulated Amortization | 322 | 318 | |
Net Book Value | 64 | 68 | |
Intellectual property | |||
Finite-Lived Intangible Assets [Line Items] | |||
Cost | 124 | 123 | |
Accumulated Amortization | 66 | 64 | |
Net Book Value | $ 58 | $ 59 |
Consolidated Balance Sheets D_7
Consolidated Balance Sheets Details Consolidated Balance Sheet Details - Changes to Carrying Amount of Goodwill (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
May 31, 2023 | Feb. 28, 2023 | |
Goodwill [Roll Forward] | ||
Carrying amount as of beginning of period | $ 595 | $ 844 |
Impairment of goodwill | 245 | |
Effect of foreign exchange on non-U.S. dollar denominated goodwill | 1 | (4) |
Carrying amount as of end of period | $ 596 | $ 595 |
Consolidated Balance Sheets D_8
Consolidated Balance Sheets Detail - Additional Information (Details) | 3 Months Ended | 12 Months Ended |
May 31, 2023 | Feb. 28, 2023 | |
Accrued Liabilities | ||
Other Receivables Greater than Five Percent of Current Assets | none | none |
Other accrued liabilities greater than five percent of current liabilities | none | none |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | ||
May 31, 2023 | May 31, 2022 | Feb. 28, 2023 | |
Income Tax Disclosure [Abstract] | |||
Effective Income Recovery (Expense) Tax Rate Reconciliation, Percent | (38.00%) | (2.00%) | |
Unrecognized Tax Benefits | $ 21 | $ 21 | |
Unrecognized tax benefits netted against deferred income taxes | 21 | ||
Unrecognized tax benefits included within taxes payable | $ 0 |
Debentures (Details)
Debentures (Details) - USD ($) $ in Millions | 3 Months Ended | ||
May 31, 2023 | May 31, 2022 | Sep. 01, 2020 | |
Debt Instrument [Line Items] | |||
Face amount of debt | $ 365 | ||
Redemption period, end date | Nov. 13, 2023 | ||
Unpaid principal balance | $ 365 | ||
Fair Value, Option, Aggregate Differences, Long-term Debt Instruments | (24) | ||
Interest expense, debt | 2 | $ 2 | |
Related Party Principal Amounts of 1.75% Debenture Owned | $ 330 | ||
Fair Value Inputs, Entity Credit Risk | 7.44% | 7.90% | |
Long-term debentures (note 5) | $ 456 | ||
Debenture implied discount | $ 91 |
Debentures - Change in Fair Val
Debentures - Change in Fair Value (Details) - USD ($) $ in Millions | 3 Months Ended | ||
May 31, 2023 | May 31, 2022 | Feb. 28, 2023 | |
Debt Instrument [Line Items] | |||
Debenture total fair value adjustment | $ 22 | $ (48) | |
Debentures (note 5) | $ 389 | $ 367 |
Debentures - Impact of Changes
Debentures - Impact of Changes in Fair Value of Debentures (Details) - USD ($) $ in Millions | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Debt Instrument [Line Items] | ||
Income (charge) associated with the change in fair value from non-credit components recorded in the consolidated statements of operations | $ (22) | $ 46 |
Income (charge) associated with the change in fair value from instrument-specific credit components recorded in AOCL | 0 | 2 |
Debenture total fair value adjustment | $ (22) | $ 48 |
Capital Stock - Changes in Issu
Capital Stock - Changes in Issued and Outstanding Common Shares (Details) - USD ($) $ in Millions | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Common Stock [Roll Forward] | ||
Capital stock outstanding, Shares, Beginning Balance | 582,157,203 | |
Capital stock outstanding, Shares, Ending Balance | 583,237,331 | |
Common Stock, Amount [Roll Forward] | ||
Exercise of stock options | $ 0 | |
Stock-based compensation | $ 9 | 8 |
Employee share purchase plan | $ 2 | 3 |
Capital Stock and Additional Paid-in Capital | ||
Common Stock [Roll Forward] | ||
Capital stock outstanding, Shares, Beginning Balance | 582,157,000 | |
Exercise of stock options | 52,000 | |
Common shares issued for restricted share unit settlements | 461,000 | |
Common shares issued for employee share purchase plan | 567,000 | |
Capital stock outstanding, Shares, Ending Balance | 583,237,000 | |
Common Stock, Amount [Roll Forward] | ||
Common Stock, Value, Outstanding | $ 2,909 | |
Exercise of stock options | 0 | |
Stock-based compensation | 9 | 8 |
Employee share purchase plan | 2 | $ 3 |
Common Stock, Value, Outstanding | $ 2,920 |
Capital Stock - Subsequent even
Capital Stock - Subsequent event (Details) - shares | 3 Months Ended | ||
May 31, 2023 | Jun. 26, 2023 | Feb. 28, 2023 | |
Equity [Abstract] | |||
Common outstanding (in shares) | 583,237,331 | 582,157,203 | |
Class of Stock [Line Items] | |||
Common outstanding (in shares) | 583,237,331 | 582,157,203 | |
1.75% Debenture | |||
Class of Stock [Line Items] | |||
Conversion of stock (in shares) | 60,800,000 | ||
Voting Common Stock [Member] | Subsequent Event [Member] | |||
Equity [Abstract] | |||
Common outstanding (in shares) | 583,000,000 | ||
Class of Stock [Line Items] | |||
Common outstanding (in shares) | 583,000,000 | ||
Employee Stock Option [Member] | Subsequent Event [Member] | |||
Equity [Abstract] | |||
Common outstanding (in shares) | 400,000 | ||
Class of Stock [Line Items] | |||
Common outstanding (in shares) | 400,000 | ||
Restricted Share Units (RSUs) | Subsequent Event [Member] | |||
Equity [Abstract] | |||
Common outstanding (in shares) | 18,000,000 | ||
Class of Stock [Line Items] | |||
Common outstanding (in shares) | 18,000,000 | ||
Deferred Share Unit | Subsequent Event [Member] | |||
Equity [Abstract] | |||
Common outstanding (in shares) | 2,000,000 | ||
Class of Stock [Line Items] | |||
Common outstanding (in shares) | 2,000,000 |
Earnings (Loss) Per Share - Sum
Earnings (Loss) Per Share - Summary of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | ||||
May 31, 2023 | May 31, 2022 | ||||
Earnings Per Share [Abstract] | |||||
Net loss for basic loss per share available to common shareholders | $ (11) | $ (181) | |||
Debentures fair value impact on EPS | 0 | [1] | (46) | [2] | |
Interest expense, debt adjustment impact on EPS | 0 | [1] | 2 | [2] | |
Net loss for diluted loss per share available to common shareholders | $ (11) | $ (225) | |||
Weighted-average number of shares outstanding (000's) - basic and diluted (in shares) | [3] | 582,812 | 576,877 | ||
Dilutive Securities, Effect on Basic Earnings Per Share, Dilutive Convertible Securities (in shares) | 0 | [1] | 60,833 | [2] | |
Weighted Average Number of Shares Outstanding, Diluted, Total (in shares) | 582,812 | 637,710 | |||
Earnings (Loss) Per Share, Basic (in usd per share) | $ (0.02) | $ (0.31) | |||
Earnings (Loss) Per Share, Diluted (in usd per share) | $ (0.02) | $ (0.35) | |||
[1]The Company has not presented the dilutive effect of the Debentures using the if-converted method in the calculation of diluted loss per share for the three months ended May 31, 2023, as to do so would be antidilutive. See Note 5 for details on the Debentures.[2]The Company has presented the dilutive effect of the Debentures using the if-converted method, assuming conversion at the beginning of the quarter for the three months ended May 31, 2022. Accordingly, to calculate diluted loss per share, the Company adjusted net loss by eliminating the fair value adjustment made to the Debentures and interest expense incurred on the Debentures for the three months ended May 31, 2022, and added the number of shares that would have been issued upon conversion to the diluted weighted average number of shares outstanding. See Note 5 for details on the Debentures.[3]The Company has not presented the dilutive effect of in-the-money options and RSUs that will be settled upon vesting by the issuance of new common shares in the calculation of diluted loss per share for the three months ended May 31, 2023 and May 31, 2022, as to do so would be antidilutive. |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss - Components of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Beginning Balance | $ 857 | $ 1,556 |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | 1 | (4) |
Other Comprehensive Income (Loss), Financial Liability, Fair Value Option, Unrealized Gain (Loss) Arising During Period, after Tax | 0 | 2 |
Ending Balance | 859 | 1,385 |
Cash Flow Hedges | ||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Beginning Balance | (1) | 0 |
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), before Reclassification, after Tax | 0 | 1 |
Amounts reclassified from AOCL into net loss | 1 | 0 |
Ending Balance | 0 | 1 |
Foreign Currency Cumulative Translation Adjustment | ||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Beginning Balance | (16) | (10) |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | 1 | (4) |
Ending Balance | (15) | (14) |
Change in Fair Value From Instrument-Specific Credit Risk On Debentures | ||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Beginning Balance | (6) | (8) |
Other Comprehensive Income (Loss), Financial Liability, Fair Value Option, Unrealized Gain (Loss) Arising During Period, after Tax | 0 | 2 |
Ending Balance | (6) | (6) |
Other Post-Employment Benefit Obligations | ||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Ending Balance | (1) | (1) |
AOCI Attributable to Parent | ||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Ending Balance | $ (22) | $ (20) |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
May 31, 2023 | Feb. 28, 2023 | |
Loss Contingencies Line Items] | ||
Collateral of outstanding letters of credit | $ 26 | |
Executive Chair Grant Liability | 0 | $ 0 |
Funds from claim filed with Ministry of Innovation, Science and Economic Development Canada relating to Strategic Innovation Fund Program | 17 | $ 17 |
Executive Chair and CEO [Member] | ||
Loss Contingencies Line Items] | ||
Contingent performance-based cash award | $ 90 | |
10-day average closing price for cash award | $ 30 | |
Expiry date of contingent performance-based cash award | Nov. 03, 2023 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |||
May 31, 2023 | Nov. 30, 2022 | Aug. 31, 2022 | May 31, 2022 | |
Results of Arbitrations and Legal Proceedings [Line Items] | ||||
Payments for Legal Settlements | $ 164 | $ 1 | ||
Litigation Settlement, Expense | $ 0 | $ 165 |
Revenue and Segment Disclosur_2
Revenue and Segment Disclosures (Details) - Additional Details - USD ($) $ in Millions | 3 Months Ended | |
May 31, 2023 | May 11, 2023 | |
Segment Reporting [Abstract] | ||
Patent sale cash consideration on closing | $ 170 | |
Patent sale consideration no later than third anniversary date of closing | 30 | |
Patent sale consideration in the form of potential future royalty | $ 700 | |
Revenue recognized on patent sale | $ 218 | |
Patent sale other receivable recognized | 1 | |
Patent sale long-term receivable recognized on sale | 43 | |
Patent sale financing component | 15 | |
Patent sale variable consideration recognized on sale | 23 | |
Patent sale variable consideration constrained | $ 210 |
Revenue and Segment Disclosur_3
Revenue and Segment Disclosures - Operating results by operating segments (Details) $ in Millions | 3 Months Ended | |
May 31, 2023 USD ($) operatingSegment | May 31, 2022 USD ($) | |
Segment Reporting [Abstract] | ||
Number of Operating Segments | operatingSegment | 3 | |
Segment Reporting Information [Line Items] | ||
Revenues | $ 373 | $ 168 |
Cost of sales | 194 | 64 |
Gross Profit | 179 | 104 |
Cybersecurity | ||
Segment Reporting Information [Line Items] | ||
Revenues | 93 | 113 |
Cost of sales | 37 | 53 |
Gross Profit | 56 | 60 |
IoT | ||
Segment Reporting Information [Line Items] | ||
Revenues | 45 | 51 |
Cost of sales | 9 | 8 |
Gross Profit | 36 | 43 |
Licensing and Other | ||
Segment Reporting Information [Line Items] | ||
Revenues | 235 | 4 |
Cost of sales | 147 | 2 |
Gross Profit | 88 | 2 |
Total Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Revenues | 373 | 168 |
Cost of sales | 193 | 63 |
Gross Profit | $ 180 | $ 105 |
Revenue and Segment Disclosur_4
Revenue and Segment Disclosures - Reconciliation of Operating Profit (Loss) from Segments to Consolidated (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
May 31, 2023 | May 31, 2022 | Feb. 28, 2023 | ||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Gross Profit | $ 179 | $ 104 | ||
Cost of sales | 194 | 64 | ||
Research and development | 54 | 53 | ||
Selling, marketing and administration | 99 | 82 | ||
Amortization | 15 | 27 | ||
Impairment of goodwill | $ 245 | |||
Debentures fair value adjustment | 22 | (46) | ||
Investment income (loss), net (note 2 and note 5) | 3 | (1) | ||
Loss before income taxes | (8) | (178) | ||
Total Operating Segments | ||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Gross Profit | 180 | 105 | ||
Cost of sales | 193 | 63 | ||
Segment Reconciling Items | ||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Cost of sales | [1] | 1 | 1 | |
Investment income (loss), net (note 2 and note 5) | $ 3 | $ (1) | ||
[1]The CODM reviews segment information on an adjusted basis, which excludes certain amounts as described below: Stock compensation expenses - Equity compensation is a non-cash expense and does not impact the ongoing operating decisions taken by the Company’s management. |
Revenue and Segment Disclosur_5
Revenue and Segment Disclosures - Revenue from External Customers by Geographic Areas (Details) - USD ($) $ in Millions | 3 Months Ended | ||
May 31, 2023 | May 31, 2022 | ||
Segment Reporting Information [Line Items] | |||
Total Revenue | $ 373 | $ 168 | |
Total Revenue Rate | 100% | 100% | |
Number of customers that comprised more than 10% of total revenue | one | one | |
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | One Customer | |||
Segment Reporting Information [Line Items] | |||
Concentration risk, percentage | 58% | 15% | |
North America | |||
Segment Reporting Information [Line Items] | |||
Total Revenue | [1] | $ 317 | $ 89 |
Total Revenue Rate | [1] | 85% | 53% |
Europe, Middle East and Africa | |||
Segment Reporting Information [Line Items] | |||
Total Revenue | $ 37 | $ 60 | |
Total Revenue Rate | 9.90% | 35.70% | |
Other regions | |||
Segment Reporting Information [Line Items] | |||
Total Revenue | $ 19 | $ 19 | |
Total Revenue Rate | 5.10% | 11.30% | |
[1]North America includes all revenue from the Company’s intellectual property arrangements, due to the global applicability of the patent portfolio and licensing arrangements thereof |
Revenue and Segment Disclosur_6
Revenue and Segment Disclosures Revenue classified by timing of recognition (Details) - USD ($) $ in Millions | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Revenue classified by timing of recognition [Line Items] | ||
Revenues | $ 373 | $ 168 |
Products and services transferred over time | ||
Revenue classified by timing of recognition [Line Items] | ||
Revenues | 85 | 97 |
Products and services transferred at a point in time | ||
Revenue classified by timing of recognition [Line Items] | ||
Revenues | $ 288 | $ 71 |
Revenue and Segment Disclosur_7
Revenue and Segment Disclosures Revenue Contract Balances (Details) - USD ($) $ in Millions | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Revenue Contract Balances [Line Items] | ||
Increase (Decrease) in Deferred Revenue | $ (12) | $ (22) |
Accounts and Other Receivable | ||
Revenue Contract Balances [Line Items] | ||
Contract with Customer, Asset, Net - Current and Non-Current | 120 | |
Increase in contract receivable | 396 | |
Decrease in contract asset | (347) | |
Increase (Decrease) In Contract Assets | 49 | |
Contract with Customer, Asset, Net - Current and Non-Current | 169 | |
Deferred Revenue | ||
Revenue Contract Balances [Line Items] | ||
Deferred Revenue | 215 | |
Deferred Revenue, Additions | 127 | |
Decrease due to payment, fulfillment of performance obligations, or other | (139) | |
Increase (Decrease) in Deferred Revenue | (12) | |
Deferred Revenue | 203 | |
Deferred Commissions | ||
Revenue Contract Balances [Line Items] | ||
Capitalized Contract Cost, Net | 17 | |
Increase in deferred commission | 6 | |
Decrease in deferred commission | (6) | |
Net change in deferred commission | 0 | |
Capitalized Contract Cost, Net | $ 17 |
Revenue and Segment Disclosur_8
Revenue and Segment Disclosures -Transaction price allocated to the remaining performance obligations (Details) - USD ($) $ in Millions | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Transaction price allocated to the remaining performance obligations [Line Items] | ||
Contract with Customer, Performance Obligation Satisfied in Previous Period | $ 9 | $ 0 |
Revenue, Remaining Performance Obligation, Amount | 203 | |
Less than 12 months | ||
Transaction price allocated to the remaining performance obligations [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | 177 | |
12 to 24 months | ||
Transaction price allocated to the remaining performance obligations [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | 11 | |
After 24 months | ||
Transaction price allocated to the remaining performance obligations [Line Items] | ||
Revenue, Remaining Performance Obligation, Amount | $ 15 |
Revenue and Segment Disclosur_9
Revenue and Segment Disclosures - Long-lived Assets and Total Assets by Geographic Areas (Details) - USD ($) $ in Millions | May 31, 2023 | Feb. 28, 2023 |
Long-lived Assets and Total Assets by Geographic Areas [Line Items] | ||
Long-Lived Assets | $ 856 | $ 867 |
Assets | 1,674 | 1,679 |
Canada | ||
Long-lived Assets and Total Assets by Geographic Areas [Line Items] | ||
Long-Lived Assets | 94 | 98 |
Assets | 323 | 375 |
United States | ||
Long-lived Assets and Total Assets by Geographic Areas [Line Items] | ||
Long-Lived Assets | 735 | 742 |
Assets | 1,262 | 1,208 |
Other Countries | ||
Long-lived Assets and Total Assets by Geographic Areas [Line Items] | ||
Long-Lived Assets | 27 | 27 |
Assets | $ 89 | $ 96 |
Cash Flow and Additional Info_3
Cash Flow and Additional Information - Interest and Income Taxes Paid (Details) - USD ($) $ in Millions | 3 Months Ended | |
May 31, 2023 | May 31, 2022 | |
Supplemental Cash Flow Information [Abstract] | ||
Interest paid during the period | $ 2 | $ 2 |
Income taxes paid during the period | 2 | 1 |
Income tax refunds received during the period | $ 0 | $ 0 |
Additional Information - Additi
Additional Information - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | ||
May 31, 2022 | May 31, 2023 | Feb. 28, 2023 | |
Supplemental Cash Flow Information [Abstract] | |||
Percentage of cash and cash equivalents denominated in foreign currencies | 21% | 19% | |
Percentage of accounts receivable denominated in foreign currencies | 35% | 24% | |
Percentage of accounts payable denominated in foreign currencies | 38% | 36% | |
Percentage of cash, cash equivalents and investments threshold used to determine major issuer | 18% | 12% | |
Derivative asset, fair value of collateral | $ 1 | ||
Derivative liability, fair value of collateral | $ 1 | ||
Cash, Cash Equivalents And Investments | $ 578 | $ 487 | |
Government subsidies | $ 4 | ||
Government Assistance, Amount, Cumulative, Current | $ 4 | ||
Government Assistance, Statement of Financial Position [Extensible Enumeration] | Other receivables (note 3) |