BlackBerry’s(s bbry) Q3 earnings are in, and the numbers are pretty dismal. The company took a $4.4 billion write-down on unsold devices, and only sold 1.9 million smartphones compared to 3.7 million last quarter. On top of this, most of the smartphones sold were older BlackBerry 7 devices, rather than the BlackBerry 10 phones it was betting big on.
But while these results might seem like reason enough for BlackBerry to exit the hardware market entirely, it is doing just the opposite. The company on Friday announced a five-year strategic partnership with Foxconn, the world’s largest electronic product and components manufacturer.
“This partnership demonstrates BlackBerry’s commitment to the device market for the long-term and our determination to remain the innovation leader in secure end-to-end mobile solutions,” said BlackBerry’s new CEO John Chen. “Partnering with Foxconn allows BlackBerry to focus on what we do best – iconic design, world-class security, software development and enterprise mobility management – while simultaneously addressing fast-growing markets leveraging Foxconn’s scale and efficiency that will allow us to compete more effectively.”
Under this partnership, Foxconn will help develop, manufacture and manage new BlackBerry devices. But these aren’t phones aren’t likely to become worldwide flagships. Instead, the focus will be on Indonesia and other emerging markets.
To help provide a more efficient model for its device division, the company has been divided into the following divisions: Enterprise Services, Messaging, QNX Embedded business and the Devices business. The company also hopes this will drive greater focus on services and software.
But if the hardware plan ultimately doesn’t pan out, there is a shred of hope: In the last 60 days, more than 40 million Android(s goog) and iOS(s aapl) users have registered for BlackBerry’s BBM app. In addition to this, more than a dozen OEMs have announced plans to preload BBM onto their Android devices, most notably LG.