BlackBerry Ltd. Executive Chairman and Chief Executive Officer John Chen said he’s not seeing a recession — at least not in the software company’s burgeoning Internet of Things (IoT) business. 

“So [for] the business I am in, I have to qualify that, in the IoT space, particularly in the auto and the internet-connected world and cybersecurity, the answer is...I am not seeing a hard landing,” Chen said in an interview, when asked about the possibility of a recession. 

He said that’s because the automotive customers that have integrated BlackBerry’s technology continue to be focused on the future; and while some may have pared their spending, Chen said he hasn’t heard any of them say, “We're in survival mode.” 

“In fact, quite the opposite. In the auto space for example, they’re all talking about the future, they’re all talking about the new design that's going to come in three years and so forth. So I don't see a hard landing,” Chen said. 

BlackBerry operates as a software provider and has deals in place with Volkswagen and other automakers to equip vehicles with its QNX operating system. 

The automotive IoT industry may avoid a downturn due in part to government efforts on environmental protection that have taken shape in many countries, according to Chen, which incentivizes a shift to electric vehicles.

“There is a replacement cycle coming up that is necessary to fulfill these requirements of environmental mandates,” he said. 

In its second-quarter earnings, reported Tuesday, BlackBerry said IoT revenue totalled US$51 million, representing a 28 per cent year-over-year increase. IoT revenue accounted for around 30 per cent of its US$168 million in total revenue during the quarter. 

Part of the reason BlackBerry has seen IoT revenue growth is due to automotive companies in the design phase that are trying to meet the replacement cycle, Chen said.

“We get revenue from winning the design, and the design will get into production, and then we'll continue to get our production revenue,” he said.