Blackberry (BBRY) Q2 Fiscal 2017 Earnings Call

Blackberry (BBRY) CEO John Chen feels like the turnaround at the company is gaining traction

“Coming out of Q2, I feel that we are reaching a good inflection point where our financial picture is stable and our pivot to software taking hold.”

And he announced they no longer will be manufacturing phone handsets

“BlackBerry will focus on providing state-of-the-art security and device software. BlackBerry will discontinue internal hardware development and fully outsource this function to the third-party. BlackBerry will receive royalty per unit.”

By outsourcing their hardware manufacturing, they hope to increase returns on capital and reduce expenses 

“So with what I announced today, we will end that activity and rely completely on partners. So working with partners, relying is too strong a word, and working with them to make sure their hardware portfolio is up to spec and competitive, is of course reduce a lot of expenses, not only on operating expenses, but capital that we talk about, we don’t have inventory we need to carry anymore. So it’s a long list of savings, you know, people, equipment and so forth.”