updated 06:30 pm EST, Thu December 18, 2008
Palm quarterly financials
Smartphone-maker Palm has reported dismal results for smartphone shipments in the second fiscal quarter of 2009, with overall distribution of less than 600,000 units, 13 percent below last year's quarter. The company took a harder hit with its smartphone revenue of $171 million, marking a decrease of 39-percent year over year. The numbers also indicated a loss of $97.7 million before income tax provisions, and a gross profit decrease of over 60 percent. "We're working through an undeniably difficult period," said Ed Colligan, president and CEO.
The company recently announced that it would lay-off workers, although the number of lost jobs was not provided. Despite the hiring of two former Apple executives, a recent ChangeWave study found that only five percent of companies plan on purchasing a Palm device, down from 10 percent a year ago. The iPhone and BlackBerry smartphones dominated the results with 22 percent and 78, respectively.
Apple also took the number two position for market share in the business segment when comparing consecutive quarters, driving to 14 percent from 9, while Palm dropped from 15 percent to 11 percent. The declining trend has continued for more than a year, with Palm previously holding a 28 percent business market-share in February of 2007 compared to 59 percent for RIM.
Despite the clearly troubling numbers, Colligan tried to reassure investors that his company might have some new tricks up its sleeve. "Near term challenges shouldn't overshadow the fact that we are on track to deliver a breakthrough new platform and products that will bring a truly differentiated smartphone experience to our customers and reestablish Palm as a leading innovator in the mobile industry."
The company has organized a special event at the upcoming Consumer Electronics Show. Tipsters have suggested that the overhauled Nova operating system and a new smartphone will both be launched at the January 8th event. The new products could be pivotal in deciding Palm's fate.