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Revenue and Segment Disclosures
 3 Months Ended
May 31, 2022
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, 2022 and May 31, 2021:
 For the Three Months Ended
CybersecurityIoTLicensing and OtherSegment Totals
May 31,May 31,May 31,May 31,
20222021202220212022202120222021
Segment revenue$113 $107 $51 $43 $4 $24 $168 $174 
Segment cost of sales53 46 8 7 2 6 63 59 
Segment gross margin (1)
$60 $61 $43 $36 $2 $18 $105 $115 
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(1) A reconciliation of total segment gross margin to consolidated totals is set forth below.
Cybersecurity consists of the Company’s BlackBerry Spark® software platform, BlackBerry® AtHoc®, BlackBerry® Alert and BlackBerry SecuSUITE. The BlackBerry Spark platform is a comprehensive offering of security software products and services, including the BlackBerry Spark® Unified Endpoint Security Suite and the BlackBerry Spark® Unified Endpoint Management Suite, which are also marketed together as the BlackBerry Spark® Suite, offering the Company’s broadest range of tailored cybersecurity and endpoint management options. The BlackBerry Spark UES Suite includes revenue from the Company’s Cylance® artificial intelligence and machine learning-based platform consisting of CylancePROTECT®, CylanceOPTICS®, CylancePERSONA®, CylanceGATEWAY™, CylanceGUARD® managed services and other cybersecurity applications. The BlackBerry Spark 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, 2022 and May 31, 2021 to the Company’s consolidated totals:
 Three Months Ended
May 31, 2022May 31, 2021
Total segment gross margin$105 $115 
Adjustments (1):
Less: Stock compensation1 1 
Less:
Research & development53 57 
Selling, marketing and administration 82 73 
Amortization27 46 
Debentures fair value adjustment(46)(4)
Litigation settlement165 — 
Investment loss, net1 2 
Consolidated loss before income taxes$(178)$(60)
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(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
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, 2022May 31, 2021
North America (1)
$89 $111 
Europe, Middle East and Africa60 45 
Other regions19 18 
Total $168 $174 
North America (1)
53.0 %63.8 %
Europe, Middle East and Africa35.7 %25.9 %
Other regions11.3 %10.3 %
Total 100.0 %100.0 %
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(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, 2022May 31, 2021
Products and services transferred over time$97 $107 
Products and services transferred at a point in time71 67 
Total$168 $174 
Revenue contract balances
The following table sets forth the activity in the Company’s revenue contract balances for the three months ended May 31, 2022:
Accounts ReceivableDeferred RevenueDeferred Commissions
Opening balance as at February 28, 2022$138 $244 $16 
Increases due to invoicing of new or existing contracts, associated contract acquisition costs, or other159 137 6 
Decrease due to payment, fulfillment of performance obligations, or other(195)(159)(6)
Decrease, net(36)(22)— 
Closing balance as at May 31, 2022$102 $222 $16 
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, 2022 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.
As at May 31, 2022
Less than 12 Months12 to 24 MonthsThereafterTotal
Remaining performance obligations$191 $27 $10 $228 
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, 2022February 28, 2022
Property, Plant and Equipment, Intangible Assets, Operating Lease ROU Assets and GoodwillTotal AssetsProperty, Plant and Equipment, Intangible Assets, Operating Lease ROU Assets and GoodwillTotal Assets
Canada$118 $391 $117 $447 
United States1,285 1,934 1,313 1,989 
Other27 135 27 131 
$1,430 $2,460 $1,457 $2,567 
Information About Major Customers
There was one customer that comprised 15% of the Company’s revenue in the three months ended May 31, 2022 (three months ended May 31, 2021 - no customer comprised more than 10% of the Company’s revenue).