Pressure is building across technology and consumer stocks as investors reassess growth expectations, valuation multiples and the durability of revenue in a slowing global economy. From legacy tech firms to global athletic brands, weak guidance and uneven international demand are testing confidence.
BNN Bloomberg spoke with John Zechner, chairman and founder of J. Zechner Associates, about concerns surrounding BlackBerry’s growth profile, Nike’s struggles in China, and why investor enthusiasm for AI-linked companies such as Oracle is facing closer scrutiny.
Key Takeaways
- BlackBerry’s reliance on two core businesses limits growth potential and makes its valuation difficult to justify without stronger revenue momentum.
- Consumer brands are struggling to maintain premium pricing as cost-conscious shoppers push back, particularly in China.
- Shifts toward direct-to-consumer sales have not fully offset weaker wholesale and international distribution channels.
- AI-linked stocks face rising scepticism as investors question how future growth is financed and whether promised revenue will materialize.
- Valuation discipline is returning, with investors favouring established platforms over more speculative growth stories.
Read the full transcript below:
ANDREW: Revenue declined at BlackBerry, apparently not delighting investors. Let’s get more from John Zechner, chairman and founder of J. Zechner Associates. John, thanks very much for joining us. You and I have been tracking BlackBerry for years now. What’s your view on the stock? They’ve carved out a franchise with QNX software used in autos and elsewhere.
JOHN: You’re right, Andy. QNX was probably the last major acquisition Jim Balsillie made back in the day, and it has really become the heart of the company. Having said that, the results were a disappointment. Year-over-year growth was around 10 per cent, while market expectations were closer to 15 per cent.
They’re really down to two core businesses right now: QNX and secure communications, which is effectively what remains of their cybersecurity operations. They never made much of an imprint there, and it’s been a disappointment. Overall revenue was down about 10 per cent year over year, so the company is hardly growing.
One division is shrinking, the other is the core business and is doing fine, but that doesn’t justify a valuation of roughly 25 times EBIT. You pay that kind of multiple for an extremely high-growth company with market dominance, and I don’t think that’s what we’re seeing here.
If you wind the clock back, there have been a lot of ups and downs over the years. John Chen, I think, was never fully appreciated for what he did when he took over in 2013, when the core business was headed toward zero. They did a good job repositioning the company to keep it alive, but there’s nothing here you’re paying for growth. There’s nothing particularly proprietary about the software, and they failed to gain meaningful traction in cybersecurity despite BlackBerry Messenger once being a strong security platform.
ANDREW: Let’s talk about Nike. They just can’t seem to fix their Chinese business.
JOHN: China has been difficult. Sales channels are shifting more toward direct sales rather than broad-based distribution. The Converse brand is also not doing particularly well.
The company beat expectations on the quarter, but guidance going forward was sloppy, and China is a big part of that. We’re seeing cost-conscious consumers pay less for branded names. They may still prefer brands, but they’re not willing to pay big premiums.
You see similar pressure elsewhere. Look at Lululemon and the restructuring they’re doing, and how weak that stock has been over the past year and a half. Nike is going through the same thing. They’ve got the brand, but they’re not getting the premium pricing or the distribution they need, and China sales, which used to be a major driver, are clearly diminishing.
ANDREW: You touched on this, John. China is often described as a mono-brand economy for these products, with companies selling through their own stores. Nike does that, but it’s struggling through other retailers.
JOHN: It is. The company that has probably navigated that better than anyone in China is Apple. They face competition from domestic, lower-cost brands, yet they’ve managed to maintain premium pricing and hold up sales. They’ve beaten that challenge better than most.
ANDREW: Oracle is also in the news, potentially involved in taking over TikTok. It seems strange for a company that started as a database and enterprise software firm.
JOHN: They’ve got feelers out everywhere, Andy. I’ve been writing some year-end comments, and there’s a line I like: if Nvidia is the coal mine for AI, then Oracle is the canary.
The stock surged in September, moving north of US$300, as Oracle positioned itself as an AI cloud player. They reported massive order growth, with hundreds of billions of dollars in commitments over several years. But people are now questioning how that growth is being financed.
Debt spreads are widening, and a lot of what they’re reporting is tied to remaining performance obligations, or RPOs. That’s not revenue — it’s potential revenue. That’s where the skepticism is coming from.
There’s also concern about the convoluted financing and rising debt across the sector. Oracle is at the front end of that. They dominate database software, and it makes sense that data would be central to AI expansion. But the stock has gotten far ahead of itself.
There are safer places in technology where you’re not paying these kinds of multiples. Look at companies like Adobe, Salesforce, or even the big hyperscalers such as Amazon, Alphabet and Meta. They have platforms and public clouds where AI can be integrated more reliably.
The more speculative players are where you see risk. Oracle is down roughly 40 per cent from its September peak. That’s the danger when excitement runs ahead of delivered revenue. If the numbers don’t materialize, there’s a lot of air underneath those stocks.
ANDREW: It’s worth noting that Oracle is reportedly part of an investor group that would control a joint venture running TikTok’s U.S. business.
JOHN: It’s a great platform, and strategically it makes sense. There’s a lot of value there, and it’s an advantage for whoever ends up controlling it. But Oracle has a lot of oars in the water right now, and not all of them are generating returns.
ANDREW: John, thank you very much.
JOHN: Thank you.
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This BNN Bloomberg summary and transcript of the Dec. 19, 2025 interview with John Zechner are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
