BlackBerry wins $814.9 million royalty refund

BlackBerry stock rose the most in more than two years after it was awarded $814.9 million to end a dispute with Qualcomm Inc. over royalty payments, giving it cash needed to help recast itself as a software maker.

The two companies had agreed to enter binding arbitration to settle claims by BlackBerry that it was owed refunds on technology licensing fees prepaid to the chipmaker.

The refund from Qualcomm will boost BlackBerry's cash hoard, which stood at $1.7 billion at the end of its fiscal fourth quarter, helping CEO John Chen as he spends more money to shift the company's focus to software and security-focused products.

BlackBerry no longer makes the phones that used Qualcomm technology and argued that it was due a refund after sales collapsed.

'With BlackBerry planning to invest for growth in its software businesses, the surprising arbitration award and $815 million in cash from Qualcomm will bolster BlackBerry's balance sheet and increase the likelihood of acquisitions to augment growth,” Canaccord Genuity technology analyst Michael Walkley wrote Wednesday in a report.

Qualcomm, which owns patents that cover the fundamentals of modern mobile technology, gets a cut of the selling price of handsets from phone makers, whether they use its chips or not. The San Diego-based semiconductor maker gets the majority of its profit from those license payments.