Monday, March 23, 2009

Palm Q3FY09 Wrap Up

Palm held their quarterly earns conference call last week and the revenue numbers didn't look good. According to Palm, they won't look good at the end of next quarter either. Eric Savitz over on Barron's Tech Trader Daily blog as a nice summary. Mr. Savitz writes:

"For investors in Palm, the company is now in a sort of spring training period - what matters is getting ready for opening day. No one really cares if the Yankees have the best record in in the Grapefruit League; and likewise, the Street has decided to simply ignore the absolutely nightmarish numbers Palm posted for the February quarter. Palm has one more free pass ahead; May’s report will be even nastier still, and investor won’t care unless there is an acceleration in cash burn. Palm is a company that, by design, is going down in flames, with every hope of rising Phoenix-like from the ashes."

I've loved using Palm's products over the last 10 years so I've always been a glass half full kind of guy when it comes to Palm. Regardless of what happens, Palm is betting the farm that the Palm Pre smartphone and it's new mobile operating system, webOS, are going to a hit. During the conference call, Palm's executives continue to stick to their guns and are porting that the Pre will ship before the end of the first half of this year.

Back in January, many expected Pre to ship in February, and then again by March 15th. That hasn't happened. I'm sure Palm and Sprint are both scambling to get this phone out the door. The challenge is that the phone and the software need to have a flawless execution once it gets into customer's hands. During 1SRC Podcast 205, I talked about the Pre likely shipping in late May as did the Treo 700p and 755p smartphones did. However, Mr. Savitz summerizes the situation a little bit differently by writing:

"The Palm Pre is expected to ship before the end of June; some analysts think it happen before the end of the May quarter, but most figure it will be later than that."

Let's hope that Palm and Sprint have that flawless launch. There is a lot riding on Pre and webOS.

You can read the full Barron's artilce on the Tech Trader Daily blog.

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