Palm Still Losing Money as It Works to Reinvent Itself

Palm, Inc. had some good news to share about its most recent financial quarter: it sold over a million smartphones, and its revenue from smartphones was up, too. But the company still reported a significant loss.

During the June to August period, Palm sold 1,029,000 smartphones, a 49% increase year over year. Smartphone revenue was $333.8 million, up 10% from the year-ago period.

Its total revenue was $366.9 million, slightly higher than its revenue in the same quarter of 2007. Nevertheless, Palm lost $41.9 million, or 39 cents per diluted common share.

Still, Palm did better than analysts were expecting, beating their predictions for both revenue and losing less money.

Looking Ahead

“While we’re still in the midst of our transformation and have challenges ahead, we are bringing outstanding new products to market, hiring world-class talent and preparing to launch a new platform that will usher in a new era at Palm," said Ed Colligan, Palm president and CEO.

Colligan is referring to his company's ongoing project to release a Linux-based operating system to replace the aging Palm OS.

During this most recent quarter, Palm launched the Treo 800w and announced Treo Pro, both Windows Mobile-based, business-oriented smartphones. Its next consumer-oriented devices will run its new operating system.

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• Palm Treo 800w Review