Maker of smartphones and devices formerly known as Personal Digital Assistants (PDAs) Palm is haemorrhaging money. The company sold 482,000 smartphones during its third quarter, 42% less than back one year ago. Revenue with clever handhelds fell 72% year over year, landing at $77.5 million. Revenues totalled $90.6 million, not even a third of the $312 million Palm turned over in 2008. The net loss summed up to $95 million. So far, Palm has lost $640.7 million in the last three quarters of fiscal year 2009.
Palm's money chest is currently home to $130.8 million in cash and cash equivalents and $88.6 million in short-term investments, bringing the bounty to $219.4 million. All in all, the company's total assets dwindled from $1.2 billion to $656.4 billion.
Things aren't entirely hopeless for Palm. The company put its up-and-coming smartphone Palm Pre on display at the CES this year, garnering praise and nearly all of the attention. The handheld will be using a newly developed operating system, called WebOS. WebOS is building up a lot of traction and is set to shake the boots of competitors such as Apple and Google. Apple has already threatened legal action, however nothing has been filed with a court as of yet.
Palm said it will recognize WebOS product revenues and costs on a subscription basis, based on the 24 month product cycle of a subscriber phone. As such, Palm will defer revenues and costs.
“We’re proceeding through a challenging transitional period, however our current results shouldn’t overshadow the tremendous progress we’ve made against our strategic goals. We’re poised to usher in a new era at Palm,” said Ed Colligan, Palm president and chief executive officer. X
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