Palm has insisted its anticipated Pre smart phone, its answer to the iPhone and BlackBerry Storm, remains on track for the first half of this year. It can’t come sooner because the company has reported a 73pc drop in revenue and is burning through cash.
Palm – the one-time smart device leader – said the revenue declines were a result of reduced demand for its maturing legacy smart-phone products, the economic environment and the late shipment of its Treo Pro in the US.
“The much-anticipated launch of the Palm Pre remains on track for the first half of calendar year 2009, but, as expected, we’ve got a difficult transition period to work through,” said Palm President and chief executive officer, Ed Colligan.
“Despite the challenging market environment, the extraordinary response to the Palm Pre and the new Palm web operation system (OS) reaffirms our confidence in our long-term prospects and our ability to re-establish Palm as the leading innovator in the growing smart-phone market.” Colligan said.
Palm, which employs 30 people at an R&D operation in Swords, stated that cash used in operations for the quarter is expected to be between US$95m and US$100m.
The company’s cash, cash equivalents and short-term investments balance is expected to be between US$215m and US$220m at the end of the third quarter.
Palm reckons it has sufficient cash to get it through the current operating plan and economic environment, and launch the Pre handset during this half year.
By John Kennedy