BlackBerry has announced that it will stop developing its own hardware and instead outsource the function to partners.
It revealed the plan along with its second quarter earnings report, which showed that the company’s revenue had slumped 32% from the previous year to $334 million.
The company also posted a loss of $372 million, where the previous year it had shown a profit of $51 million.
“We are reaching an inflection point with our strategy. Our financial foundation is strong, and our pivot to software is taking hold,” said John Chen, executive chairman and CEO of BlackBerry.
“In Q2, we more than doubled our software revenue year over year and delivered the highest gross margin in the company’s history. We also completed initial shipments of BlackBerry Radar, an end-to end asset tracking system, and signed a strategic licensing agreement to drive global growth in our BBM consumer business,” Chen said.
He added that BlackBerry’s new mobility solutions strategy is showing signs of momentum, including its first major device software licensing agreement with a telecom joint venture in Indonesia.
“Under this strategy, we are focusing on software development, including security and applications. The company plans to end all internal hardware development and will outsource that function to partners. This allows us to reduce capital requirements and enhance return on invested capital,” Chen said.