BlackBerry: The Push Into Physical AI Is Transformative
Key Points
BlackBerry has reinvented itself as a physical AI company on which more than 275 million vehicles rely.
A partnership with Nvidia positions it for the upcoming humanoid robot boom.
BlackBerry is generating meaningful revenue growth rates from its QNX software and may be at the start of a multiyear rally.
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BlackBerry (NYSE: BB) has reinvented itself from a smartphone company to a key player in physical AI -- AI that interacts with the physical world -- and the stock's 180% year-to-date surge through July 13 isn't a meme rally like its brief moment in 2021. BlackBerry's QNX software helps robots interact with the world safely and effectively. That's a critical feature for autonomous vehicles, drones, and humanoid robots.
The company has been securing partnerships and agreements with Nvidia, BMW, and the federal government. That's just the beginning, which makes now the right time to assess BlackBerry's long-term potential for investors.
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Winning deals now that will be transformative later
QNX isn't speculative. The software is already powering BlackBerry to meaningful growth and profits, and more than 275 million vehicles on the road use this technology. The company reported 26% year-over-year revenue growth in its fiscal 2027 first quarter (the three months ended May 31, 2026) and achieved its first fiscal quarter of positive operating cash flow in nine years, excluding a patent sale in fiscal 2024.
"We are particularly encouraged by the multiyear growth opportunities ahead in software-defined vehicles, as well as broad opportunities in the general embedded market, especially physical AI," BlackBerry CEO John J. Giamatteo told investors.
While BlackBerry is already positioned to post significant sales growth thanks to autonomous vehicles, the Nvidia partnership showcases the company's true potential. The QNX OS (operating system) was integrated with Nvidia IGX Thor and the Nvidia Halos Safety Stack, which will assist with physical AI across robotics, medical, and industrial systems.
The global humanoid robot market alone may be enough for BlackBerry to become a long-term wealth multiplier. That market is expected to maintain a 50% compound annual growth rate through 2034 and become a $165 billion industry in the process, according to Fortune Business Insights.
The backlog is steadily growing
BlackBerry wrapped up its fiscal 2022 with a $460 million backlog for QNX, and that backlog had more than doubled by the end of fiscal 2026, reaching $940 million.
Revenue for this critical segment has been accelerating as well. BlackBerry's QNX software delivered 20% year-over-year revenue growth in its fiscal 2026 fourth quarter. That growth rate jumped to 26% in BlackBerry's fiscal 2027 first quarter.
BlackBerry is currently guiding for $607.5 million in fiscal 2027 revenue, with approximately half of that coming from QNX. The company reported $549.1 million in fiscal 2026 revenue, so that would be 10.6% year-over-year growth if it hits its estimate. That's a big improvement from the company's 3% year-over-year revenue growth in its fiscal 2026.
Financials are already moving in the right direction, and BlackBerry's positioning in the physical artificial intelligence industry suggests revenue can continue to accelerate in the years ahead. That setup can help BlackBerry continue to deliver on its recent gains.
Should you buy stock in BlackBerry right now?
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Marc Guberti has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nvidia. The Motley Fool recommends Bayerische Motoren Werke Aktiengesellschaft and BlackBerry. The Motley Fool has a disclosure policy.
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