Mr. John Chen reports

BLACKBERRY REPORTS NON-GAAP PROFITABILITY AND POSITIVE CASH FLOW FOR THE FISCAL 2015 FOURTH QUARTER

BlackBerry Ltd. today released financial results for the three months and fiscal year ended Feb. 28, 2015 (all figures in United States dollars and U.S. generally accepted accounting principles, except where otherwise indicated).

Fourth-quarter highlights:

• Normalized positive cash flow of $76-million in the quarter, reversing normalized cash use of ($784)-million in fourth-quarter fiscal 2014;
• Cash and investments balance of $3.27-billion at the end of the fiscal quarter, an increase of $608-million over fourth-quarter fiscal 2014 and matching the highest balance in company history;
• Non-GAAP (generally accepted accounting principles) earnings of four cents per share, reversing a loss per share of eight cents in fourth-quarter fiscal 2014;
• Non-GAAP operating income of $2-million, reversing an operating loss of ($156)-million in fourth-quarter fiscal 2014;
• Non-GAAP gross margin of 48.3 per cent and GAAP gross margin of 48.2 per cent, with a third consecutive quarter of positive hardware gross margin;
• Software revenue of $67-million, a 20-per-cent increase over fourth-quarter fiscal 2014;
• Announced a partnership with Google to support Android for Work;
• Launched the BlackBerry Classic in December, with support for the Classic and the previously released Passport by major carriers, including Telus, Bell, Rogers, AT&T, Verizon, Vodafone and Orange;
• Completed the acquisition of Secusmart, a leader in high-security voice and text encryption;
• After the quarter at Mobile World Congress, announced the full-touch BlackBerry Leap and unveiled the coming BlackBerry device portfolio;
• Also at Mobile World Congress, announced the BlackBerry Experience Suite software portfolio that brings BlackBerry's productivity, communication, collaboration and security across all smart phone and tablets running iOS), Android and Windows;
• Other product announcements at Mobile World Congress included BES 12 Cloud, integration of WorkLife and SecuSUITE with Samsung KNOX, and Vodafone Germany's rollout of Secusmart technology

Fourth-quarter results

Revenue for the fourth quarter of fiscal 2015 was approximately $660-million, including a negative $12-million impact from currency fluctuation. The revenue breakdown for the quarter was approximately 42 per cent for hardware, 47 per cent for services and 10 per cent for software. During the fourth quarter, the company recognized hardware revenue on approximately 1.3 million BlackBerry smart phones. Approximately 1.6 million BlackBerry smart phones were sold through to end customers, with an ASP of $211 compared with $180 in the previous quarter.

Non-GAAP profit for the fourth quarter was $20-million, or four cents per share, compared with earnings of one cent per share last quarter. GAAP net income for the quarter was $28-million, or five cents per share. GAAP net income includes a non-cash charge associated with the change in the fair value of the debentures of $50-million, investment income of $115-million related to the Rockstar sale and pretax charges of $58-million related to the restructuring program.

Total cash, cash equivalents, short-term and long-term investments were $3.27-billion as of Feb. 28, 2015. The cash balance increased $156-million in the fourth quarter, including net gains of $80-million related to acquisitions and divestitures during the quarter. Aggregate contractual obligations amounted to approximately $1.3-billion as at Feb. 28, 2015, compared with $1.6-billion at the end of the third quarter. Purchase orders with contract manufacturers totalled approximately $394-million at the end of the fourth quarter, compared with $565-million at the end of the third quarter. Excluding the impact of foreign exchange, operating cash flow was $205-million, with free cash flow (operating cash flow minus capital expenditures) of $189-million.

"Our focus this past year was on getting our financial house in order while creating a multiyear growth strategy and investing in our product portfolio. We now have a very good handle on our margins, and our product road maps have been well received," said executive chairman and chief executive officer John Chen. "The second half of our turnaround focuses on stabilization of revenue with sustainable profitability and cash generation."

Outlook

The company continues to anticipate positive free cash flow.

The company is expanding its distribution capability and expects traction from these efforts to manifest some time in fiscal 2016. The company continues to target sustainable non-GAAP profitability some time in fiscal 2016.

Revenue from continuing operations for the fiscal year ended Feb. 28, 2015, was $3.3-billion. The company's non-GAAP loss from continuing operations for fiscal 2015 was $45-million or nine cents per share. The GAAP net loss from continuing operations was $304-million, or 58 cents per share. GAAP net loss from continuing operations includes the Rockstar sale adjustment of approximately $115-million (pretax and after tax), the non-cash adjustments associated with the change in the fair value of the debentures of approximately $80-million (pretax and after tax), and pretax restructuring charges of approximately $322-million ($294-million after tax) related to the company's CORE program. These charges and their related impacts on GAAP net loss from continuing operations and diluted loss per share from continuing operations are summarized in the table.

                              REVENUE BY REGION
                    (United States dollars, in millions)  
                                                                             
                                                       For the quarter ended
                                  Feb. 28,         Nov. 29,         Aug. 30, 
                                      2015             2014             2014

North America              $   205   31.0%  $   213   26.9%  $   297   32.4%
Europe, Middle East and                                                     
Africa                         283   42.9%      366   46.1%      368   40.2%
Latin America                   60    9.1%       84   10.6%      111   12.1%
Asia Pacific                   112   17.0%      130   16.4%      140   15.3%
Total                          660  100.0%      793  100.0%      916  100.0%

                                                      For the quarter ended
                                      May 31, 2014            March 1, 2014

North America                $       276     28.6%    $       297     30.4%
Europe, Middle East and                                                    
Africa                               414     42.9%            412     42.2%
Latin America                        125     12.9%            127     13.0%
Asia Pacific                         151     15.6%            140     14.4%
Total                                966    100.0%            976    100.0%

Conference call and webcast

A conference call and live webcast will be held beginning at 8 a.m. ET, which can be accessed by dialling 1-888-503-8168 or by logging on at the company's website. A replay of the conference call will also be available at approximately 10 a.m. ET by dialling 1-647-436-0148 and entering passcode 8015758 followed by the pound sign. This replay will be available until midnight ET on April 10, 2015.

                    CONSOLIDATED STATEMENTS OF OPERATIONS
       (U.S. dollars, in millions except share and per-share amounts)										

                             For the three months ended  For the year ended
                               Feb.      Nov.  March 1,      Feb.  March 1,  
                           28, 2015  29, 2014      2014  28, 2015      2014

Revenue                    $    660  $    793  $    976  $  3,335  $  6,813
Cost of sales                   342       383       423     1,731     6,856
Gross margin                    318       410       553     1,604       (43)
Gross margin (%)               48.2      51.7      56.7      48.1      (0.6)
Operating expenses
Research and
development                     134       154       246       711     1,286
Selling, marketing and
administration                  172       171       355       938     2,103
Amortization                     68        74       107       298       606
Impairment of long-
lived assets                      -         -         -         -     2,748
Debentures fair value
adjustment                       50       150       382        80       377
                                424       549     1,090     2,027     7,120
Operating (loss)               (106)     (139)     (537)     (423)   (7,163)
Investment income
(loss), net                     105       (21)      (20)       38       (21)
(Loss) before income taxes       (1)     (160)     (557)     (385)   (7,184)
Recovery of income taxes        (29)      (12)     (134)      (81)   (1,311)
Net income (loss)                28      (148)     (423)     (304)   (5,873)
Earnings (loss) per share
Total basic and diluted
earnings (loss) per
share                          0.05     (0.28)    (0.80)    (0.58)   (11.18)

We seek Safe Harbor.