v3.26.3
Revenue and Segment Disclosure (Tables)
 6 Months Ended
Aug. 31, 2026
Segment Reporting [Abstract]  
Segment Reporting
The following tables show information by reportable operating segment for the three and six months ended August 31, 2026 and August 31, 2025:
For the Three Months Ended
QNXSecure CommunicationsLicensingSegment Totals
August 31,August 31,August 31,August 31,
20262025202620252026202520262025
Segment revenue$80.3 $63.1 $60.9 $59.9 $22.1 $6.6 $163.3 $129.6 
Segment cost of sales10.6 10.7 23.5 20.2 1.5 1.5 
Segment adjusted gross margin (1)
$69.7 $52.4 $37.4 $39.7 $20.6 $5.1 $127.7 $97.2 
For the Six Months Ended
QNXSecure CommunicationsLicensingSegment Totals
August 31,August 31,August 31,August 31,
20262025202620252026202520262025
Segment revenue$152.6 $120.6 $134.5 $119.4 $29.1 $11.3 $316.2 $251.3 
Segment cost of sales21.0 21.9 44.3 38.3 3.0 3.1 
Segment adjusted gross margin (1)
$131.6 $98.7 $90.2 $81.1 $26.1 $8.2 $247.9 $188.0 
______________________________
(1) A reconciliation of total segment adjusted gross margin to consolidated pre-tax income is set forth below.
Segment Reporting, Reconciliation of Profit (Loss) by Segment to Consolidated
The following table reconciles total segment adjusted gross margin for the three and six months ended August 31, 2026 and August 31, 2025 to the Company’s consolidated totals:
Three Months EndedSix Months Ended
August 31, 2026August 31, 2025August 31, 2026August 31, 2025
Total segment adjusted gross margin$127.7 $97.2 $247.9 $188.0 
Adjustments (1):
Less: Stock compensation0.6 0.6 1.1 1.1 
Less:
Research & development33.2 25.6 66.2 50.6 
Sales and marketing25.3 24.4 54.8 53.1 
General and administrative31.8 31.5 71.1 62.0 
Amortization2.5 3.1 5.0 7.1 
Impairment of long-lived assets0.7 0.5 0.8 0.6 
Add:
Investment income, net1.6 1.9 2.7 4.8 
Consolidated income before income tax$35.2 $13.4 $51.6 $18.3 
______________________________
(1) The CODM reviews segment adjusted gross margin information on an adjusted basis, which excludes Stock compensation expenses - a non-cash expense that is not included in the CODM’s measure of segment adjusted gross margin when evaluating performance and allocating resources to the segment.
Segment Reporting, Entity-Wide Information Not Provided as Part of Reportable Segment, Geographical Area, Revenue
The Company’s revenue, classified by major geographic region in which the Company’s customers are located, was as follows:
Three Months EndedSix Months Ended
August 31, 2026August 31, 2025August 31, 2026August 31, 2025
North America (1)
$72.6 $62.3 $146.4 $117.1 
Europe, Middle East and Africa58.3 39.9 102.8 82.4 
Other regions32.4 27.4 67.0 51.8 
Total $163.3 $129.6 $316.2 $251.3 
North America (1)
44.5 %48.1 %46.3 %46.6 %
Europe, Middle East and Africa35.7 %30.8 %32.5 %32.8 %
Other regions19.8 %21.1 %21.2 %20.6 %
Total 100.0 %100.0 %100.0 %100.0 %
______________________________
(1) North America includes all revenue from Licensing, 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 Six Months Ended
August 31, 2026August 31, 2025August 31, 2026August 31, 2025
Products and services transferred over time$59.2 $60.2 $115.8 $118.7 
Products and services transferred at a point in time104.1 69.4 200.4 132.6 
Total$163.3 $129.6 $316.2 $251.3 
Revenue Contract Balances
The following table sets forth the activity in the Company’s revenue contract balances for the six months ended August 31, 2026:
Accounts ReceivableDeferred RevenueDeferred Commissions
Opening balance as at February 28, 2026$202.6 $152.6 $14.3 
Increases due to invoicing of new or existing contracts, associated contract acquisition costs, or other282.8 260.3 7.6 
Decrease due to payment, fulfillment of performance obligations, or other(276.9)(284.5)(9.1)
Increase (decrease), net5.9 (24.2)(1.5)
Closing balance as at August 31, 2026$208.5 $128.4 $12.8 
Current portion$141.0 $116.6 $6.6 
Long-term portion67.5 11.8 6.2 
$208.5 $128.4 $12.8 
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 August 31, 2026 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 sale of certain non-core patent assets to Malikie Innovations Limited in May 2023, which have been constrained based on the Company’s accounting policies and critical accounting estimates.
As at August 31, 2026
Less than 12 Months12 to 24 MonthsThereafterTotal
Remaining performance obligations$116.6 $3.4 $8.4 $128.4