BlackBerry has announced that it will no longer produce phones. Instead, it will be focusing on developing software and security products, and will outsource the designing, production, and sales of its mobile phones.

"We are reaching an inflection point with our strategy," BlackBerry Executive Chairman and CEO John Chen said in a press release. Chen added that BlackBerry's financial foundation remains strong, and their turn towards focusing on software is "taking hold."

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The news is not surprising, considering that BlackBerry has been struggling in the mobile phone market, which is currently dominated by key players Apple and Samsung. Gartner estimates that BlackBerry only had a 0.1 percent market share in the second quarter of 2016, selling only an estimated 400,400 units.

This descent, according to CNET, has been serious. Back in 2009, BlackBerry held a huge one-fifths of the mobile phone market, next only to the then-dominant Nokia.

Even with a last-ditch effort to raise sales by releasing the BlackBerry-made Android-operated Priv as well as the Alcatel-made (and Alcatel Idol 4-looking) BlackBerry DTEK50, the company still suffered a net loss of $372 million on a revenue of $334 million.

A change of focus

Chen confirmed that BlackBerry will now focus on its security and software products, and will leave all operations related to hardware to outsourced companies. He added that BlackBerry would only collect royalty fees for every unit sold.

"Our new Mobility Solutions strategy is showing signs of momentum, including our first major device software licensing agreement with a telecom joint venture in Indonesia," Chen explained.

Chen said that because of this, BlackBerry will cease all internal hardware development and will instead let its partners fulfill that role. This will also help to lessen expenses and enhance returns on investments.