BlackBerry, the Canadian firm that
helped pioneer the smartphone market, said Wednesday it will stop making
handsets, outsourcing production to an Indonesian partner.
Handsets with the BlackBerry name will
be produced under license by PT Tiphone Mobile Indonesia Tbk, allowing
the Canadian firm to concentrate on software and services, a statement
by the firms said.
BlackBerry, which a decade ago was among
the largest smartphone makers, has seen its global market share slip to
less than one percent amid domination by Apple and Android devices.
As the market shifted, BlackBerry has
sought to refocus on software, including security applications, and the
latest announcement takes the company out of the handset market
entirely.
“We are reaching an inflection point
with our strategy. Our financial foundation is strong, and our pivot to
software is taking hold,” said chief executive John Chen, pointing to a
doubling of software revenue in the last fiscal year.
“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.”
The Waterloo, Ontario-based company has
made several efforts in recent years to find new customer niches as its
smartphone handset sales continued to stagnate in the face of
competition.
It had hoped its first Android-operating smartphone launched last year would help restore the company to its former glory.
But sales were lackluster.
Earlier this year, BlackBerry announced
it was killing off its Classic smartphone with a physical keyboard —
once the workhorse of the smartphone market — as part of a modernization
of its lineup.
But the company has continued to bleed
red, posting on Wednesday a US$372 million loss in its second quarter
ending August 31, and US$334 million in revenues.
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