Palm’s financial woes continue

Palm recently racked up its ninth fiscal first-quarter loss in a row, offering a bleak image for the company’s future, even with the Pre smartphone release earlier in the year.

The company’s smartphone sales for Q1 2010 sky rocketed 134 percent compared to the quarter before, even with sales dropping 80 percent.  In the latest quarter, Palm only suffered a loss of $13.6 million, 10 cents per share, with financial analysts expecting a loss of 24 cents per share.

Palm’s had $360.7 million in sales, but revenue — due to WebOS — saw revenue drop down to $68 million.



“We’re making significant progress with Palm’s transformation, and our culture of innovation is stronger than ever,” Palm CEO Jon Rubinstein said in a statement.  “We’re launching more great Palm WebOS products with more carriers, and turning our sights toward growth.”

Since both Palm and Sprint have been very reluctant to release Pre sales numbers, many analysts (including myself) have been skeptical about the number of units sold since release.  The Pre was designed to be the savior for Palm and Sprint, but has failed at attracting subscribers from Verizon Wireless, AT&T, and T-Mobile.

Despite all of this doom and gloom, Palm reportedly has shipped more handsets than originally expected by financial analysts.  There were a few accounts, including Palm investor Roger McNamee, who said Pre would quickly outsell the iPhone —  although the statement was obviously asinine, other Pre supporters said the same thing.  Perhaps not the iPhone killer, but the two companies said the benefits from the Pre release has been beneficial.

It should be interesting to see how Palm and Sprint plan on rebounding, with Palm recently announcing its Palm Pixi smartphone.