BlackBerry bets on robotics as fastest-growing business, pivoting from phones to physical AI

The Tech Download: BlackBerry lost the phone war. Now it's betting on cars and robots

* BlackBerry was once one of the biggest phone makers in the world, but its business today looks vastly different from what it was two decades ago. * While well below its 2008 highs, BlackBerry's share price has doubled this year on the back of its focus on critical software. * CEO John Giamatteo joined CNBC's Arjun Kharpal for the latest episode of "The Tech Download" to discuss how the company is positioning for a future in AI. In this article * SKHY * BB * NVDA * SKHY Follow your favorite stocksCREATE FREE ACCOUNT This report is from this week's The Tech Download newsletter. Like what you see? You can subscribe here. Who remembers the phrase "BBM me?" In its heyday, BlackBerry was one of the biggest phone makers in the world. BlackBerry Messenger (BBM) was the instant messaging service that became a fixture of early smartphone culture. But while, BlackBerry remains an iconic brand, its business today looks vastly different from what it was nearly two decades ago. While far off its 2008 highs, BlackBerry's share price has doubled this year as investors reward the company's strategy to focus on critical software for cars and secure communications. John Giamatteo, CEO of BlackBerry, joined me for the latest episode of "The Tech Download" to discuss how the company is positioning for a future in AI. "While the products that we offer to our customers around the world can't necessarily be held in the palm of your hands like the old devices, those values of security, trust and innovation still shine through in the software and services and the other solutions that we deliver to the market today," Giamatteo said as he summed up the current business. John Giamatteo, CEO of BlackBerry on The Tech Download podcast New look business model Two businesses drive the bulk of BlackBerry's revenue. The first is secure communications. BlackBerry sells encrypted and secure communications products to customers like governments. The second is QNX, a business through which BlackBerry sells operating systems and other embedded software for cars to underpin features ranging from braking systems to some semi-autonomous driving functions. QNX has become a strong player in safety-critical automotive software and is embedded in 275 million vehicles, according to BlackBerry. But Giamatteo sees the QNX business as key to a future in AI, specifically, physical AI, a term that encompasses products like autonomous cars and robotics. BlackBerry has crafted its software to have high safety standards, a non-negotiable for cars and other moving objects. That could also work in areas like robotics. "We think that could be even a faster-growing segment of the industry for things like robotics," Giamatteo said. The CEO is not talking about humanoid robots, like the ones you've probably seen videos of in China recently. Instead, he is referring to robots in an industrial, factory or medical setting. Robotics is one of the company's "fastest-growing businesses inside the QNX portfolio," the CEO told me. BlackBerry is also now making money from the sector. The company has a backlog of orders for QNX worth $950 million and "a portion of that is robotics," Giamatteo said. He did not disclose specific numbers around the robotics orders. After the launch of the iPhone in 2007 transformed the smartphone industry, BlackBerry fought hard to keep its consumer mobile division alive with new devices -- but ultimately lost the battle. Its reinvention has been a remarkable one, and for now, investors seem to be embracing the new direction. News edit A San Francisco federal judge on Thursday ruled that the Pentagon's blacklisting of Anthropic earlier this year was illegal. Anthropic has inked a roughly $45 billion cloud deal with Nscale, a U.K.-based AI infrastructure company, sources told CNBC. Nvidia's near-monopoly over the most advanced AI chips is under "threat" as OpenAI's and other tech giants announce custom-built semiconductors, according to analysts. OpenAI has rolled out ads on ChatGPT for select plans in India, one of its largest and most active markets, as the company looks to maximize its revenue ahead of its planned listing next year. SK Hynix is bolstering its U.S. presence, with a new factory in Indiana that CEO Kwak Noh-Jung says will make the state a "key HBM production base in America" by 2030. One more thing Stock Chart IconStock chart icon Nvidia stock Bucking the trend -- Nvidia's stock boost on Thursday was a sharp change to its fortunes in the previous four earnings quarters. Despite meeting or beating estimates, shares dropped as investors remained unimpressed. Not so this time out. Choose CNBC as your preferred source on Google and never miss a moment from the most trusted name in business news.

BlackBerry CEO says robotics is one of its fastest-growing businesses

* BlackBerry CEO John Giamatteo told CNBC that robotics is one of the fastest-growing businesses in the company's QNX software portfolio. * QNX is embedded in 275 million vehicles and has a roughly $950 million royalty backlog, part of which comes from robotics, the company said. * The software division is well-positioned to be part of the growth of physical AI, Giamatteo said. In this article * BB * NVDA Follow your favorite stocksCREATE FREE ACCOUNT watch now VIDEO36:0836:08 BlackBerry found a second life in car software. Now it's looking to robotics The Tech Download Robotics is one of BlackBerry's fastest-growing businesses within its key software division, the CEO told CNBC, as the company positions itself for a future in physical AI. BlackBerry, once one of the biggest mobile phone makers in the world with its iconic handsets that featured keyboards, has pivoted over the years to focus on other areas. One of its biggest businesses is QNX, which it calls "safety-critical" software that runs in cars. QNX provides operating systems and other embedded software to underpin features ranging from braking systems to some semi-autonomous driving functions. QNX has become a strong player in safety-critical automotive software and is embedded in 275 million vehicles, according to BlackBerry. CEO John Giamatteo said QNX is now being used in robotics. "We think that could be even a faster-growing segment of the industry for things like robotics," Giamatteo told CNBC's "The Tech Download" podcast. The focus won't be on humanoid robots like those that have gained attention in China recently. Instead, the CEO mentioned robots in industrial settings like warehouses, robotic forklifts, and those used in the medical space. "As excited as we are about the dynamics of the automotive industry and where that's going, these other applications around robotics and medical instruments and industrial automation represent a tremendous growth opportunity. And one that I think BlackBerry and our QNX portfolio is really well positioned to address," Giamatteo said. Robotics is one of the company's "fastest-growing businesses inside the QNX portfolio," the CEO said. The company has a backlog of orders for QNX worth $950 million and "a portion of that is robotics," he added. The CEO did not disclose specific numbers around the robotics orders. BlackBerry's stock has doubled this year amid improving margins and profitability. The company has positioned itself for future growth areas like robotics and autonomous cars, which are often dubbed examples of physical AI. Stock Chart IconStock chart icon BlackBerry stock price year-to-date. Newer generations of robots can combine specialized hardware with artificial intelligence models and other software. This is where BlackBerry sees its QNX software having an edge, given its experience in the automotive space. In April, BlackBerry announced an expanded partnership with Nvidia to deploy its software alongside Nvidia's systems in robotics, medical technologies and industrial applications. "Robotics is going to shift in a hardcore way ... and we couldn't be more excited about the opportunity in front of us," Giamatteo said. Choose CNBC as your preferred source on Google and never miss a moment from the most trusted name in business news.

BlackBerry CEO says robotics is fastest-growing QNX segment

The company's QNX order backlog has reached $950 million, with Giamatteo noting that robotics accounts for some share of that total, without providing a breakdown for the segment. QNX software is currently embedded in 275 million vehicles, the company said. BlackBerry's push into robotics builds on its existing automotive software expertise. Modern robotic platforms increasingly integrate purpose-built hardware with AI and software layers, and BlackBerry argues that QNX's long track record in automotive safety-critical systems makes it well suited to compete there. In April, BlackBerry announced a partnership with Nvidia $NVDA to deploy QNX software alongside Nvidia's systems in robotics, medical technologies, and industrial applications.

BlackBerry found a second life in car software. Now it's looking to robotics

BlackBerry CEO John Giamatteo explains how its QNX car software helped reshape the company -- and why it sees robotics as a major growth opportunity. BlackBerry may be best known for its QWERTY-keyboard smartphones, but the company today is building its next chapter around software for cars, robots and secure communications. BlackBerry CEO John Giamatteo joins CNBC's Arjun Kharpal to explain how the company has reinvented itself around QNX, BlackBerry's operating system used in software-defined vehicles. He discusses why BlackBerry sees physical AI as a major growth opportunity, from autonomous vehicles and warehouse robots to surgical systems and industrial automation. As more machines become connected, Giamatteo argues that safety-certified software will become increasingly important. The conversation also covers how AI is changing the cybersecurity threat landscape, why Giamatteo sees governments' use of consumer messaging apps as a security risk, and how BlackBerry is adapting its encryption technology as threats from AI and quantum computing evolve. Subscribe to "The Tech Download" wherever you get your podcasts.