Palm loses $85.4 million in latest reported quarter -- hey, it's an improvement
By Chris Ziegler 
posted December 17th 2009 4:55PM
posted December 17th 2009 4:55PM
We don't know just how quickly Palm (or Elevation Partners, for that matter) thought it'd become profitable following the release of webOS, but it's not there quite yet -- the company is in the process of outing its earnings for the second quarter of fiscal year 2010 right now, and in a word, they're still in the red. The good news is that it's a marked improvement from last quarter -- they've gone from a $164.5M GAAP net loss to an $85.4M one this time around. On a non-GAAP gross basis, they actually made $5.5M, which is up from $2.8M a quarter earlier. They've got $590 million in cash and other "short-term investments" on the book right now, which seems like it should be enough to keep the company going without a profit or additional cash infusion for at least a few additional quarters, but then again, burn rate is going to vary with just how much hardware and software R&D they're doing and the kinds of carrier deals they're scoring. We bet they're looking forward to this Verizon business going down, eh?Update: Palm's specifically saying that they're looking to grow carrier and geographic coverage right now -- a good plan, if we say so ourselves.
Update 2: They've sold 784,000 phones in the quarter, which compares to 823,000 in the last -- a 5 percent drop. That's up 41 percent from the same quarter a year ago... but yeah, of course it's going to be way up from the pre-webOS days.
Update 3: Over 800 apps in the catalog so far, once they graduate from the Early Access Program exclusivity, Palm foresees a "flood" of apps. No plans right now to change SDK strategy to a more native development environment.
@Neros Fiddle - "death throws" ? What the hell are they?
@Ruben Check it: http://www.appleinsider.com/articles/09/11/06/report_apple_to_launch_verizon_iphone_in_q3_2010.html
@Neros Fiddle
You listed an appleinsider article as your source?
Until Verizon or Apple say that's happening, this are just rumors.
@Goc
*these.
Why isn't there and edit button?
@Neros Fiddle I don't care what the rumors say, Apple isn't going to make a CDMA iPhone. That's just not their style, to maintain two of the same product only differentiated by the radio.
The rumored tablet might use CDMA, but I highly doubt the iPhone will.
Now, an LTE iPhone on the other hand, when that comes around (2011, most likely), will definitely have a great shot of going to Verizon.
I think the fire has died for Palm. They need some sort of boost such as big app maker support and native hardware access which would allow for those big name devs to enter their catalogue. The hardware itself is plenty powerful and is in my opinion a fantastic form factor (the pre that is). If they announce hardware access at ces then I can see them being profitable by the end of the year (2010). Apps seem to be able to sell phones, and in turn sell apps.
-sent from my Palm Pre©
@MattEL
A little early to pronounce the Pre dead, don't you think? WebOS was revolutionary, if you ask me. I just wish they had better hardware to use it on.
Pre was nice, but we had to return them. Turns out the radios are defectively weak. All the sprint reps said it was a known issue and even when calling intotheir support they would literally say certain phones have cheap parts and nice parts basically implying the Pre had a Yugo radio and the Hero had a Ferrari radio. Just a simple websearch shows how bad the radio complaints are but how much the OS is loved. With Sprints massive ad campaign spend on the Pre and Palm's FAIL on that part may have sunk both Sprint and Palm for the long run. Unfortunately Iphone is still on top of the heap and will rise. Android, otherwise known as Winmo Deluxe, success remains to be seen because it may fail for many of the same reasons winmo is failing and possibly stunted by Google's shenanigans....
@bruceo Do we really need such a waste time with a Fan Boy post?...
Just say you love the iPhone... dnt make up crap about "faulty radio parts" etc...
@bruceo Ignorance! I don't know what you're talking about, I own a Pre and a Hero and I don't think that the Pre has a weak radio. Now I'll give you cheap and flimsy construction, but the radio is fine.
@bruceo
T.U.I
Typing under the influence, hurts minds. Refrain from hallucinogens.
They should have allowed other companies (like Motorola, HTC, and Nokia) to use the WebOS on their devices.
that would have saved your company but now it’s too late, your time is passing you buy and now all that’s left is for you to pimp your phone and its WebOS to Mobile Phone companies.
Android has taken the stage, the iPhone is all over the place, Nokia and WinMobile are trying to bounce back. If you survive 2012 I would be surprise.
@TheCow5 Thank GOD you aren't a CEO. Just because Palm is losing money right now doesn't mean they are a dead company, far from it.
Your argument is like the "Apple should open up OS X to run on any hardware". How in the world would Palm make money by allowing other companies to use their OS?
Android is great, it's far from taking the stage. WebOS phones directly compete with the iPhone due to the simplified UI and strong integrated apps. Android is great for the tech community, but for the average user it's not as appealing.
(I own a Palm Pre but I currently use an HTC Hero.)
@Xudd
Its call licensing, WinMobile and Sony/Ericsson does it and they make a lot of money doing so.
Apple had/have ppl who would buy anything apple and would say everyting positive about it.
Android may be in its infancy now but with all the word of mouth and all the companies using it (Motorola, HTC, Samsung, Asus, Sony/Ericsson, ect.) and skinning it, can you imagin when its all grown up how bit and wide spred it will be.
Palm does not have the following Apple has and should not be compared in the respect.
@TheCow5 Licensing works great for Microsoft because they're Microsoft! Microsoft's mobile OS existed before android and the iPhone's OS were even ideas. Once again, same thing as Apple selling copies of OS X that can run on any hardware. It's suicide.
It does not matter that Palm does not have the cult following Apple does, they compete in the same space.
@TheCow5
Not sure I would follow the business model/marketing strategy of the guy whose ship is sinking faster than anyone else's.
Then again, I am arguing with someoned named Ritarted...
@smartmouth
Engadget, if no one can fix browser incompability, at least give the option to delete posts.
@smartmouth
Engadget, if you can't fix your comment system, at least give us the option to delete posts.
The VZW deal for palm will help, BUT if HTC and Moto flood CDMA with Android devs in 2010 like this year, it's pretty much over for Palm. Otherwise, Palm needs to move into MIDs, ebooks or netbooks.
Once a PalmOS dev for 5yrs, and seeing the technology and how the business was executed in the last year: it was nice knowing you Palm.
@recharged95 I'll state this again. The Pre is a competitor with the iPhone. They are both dumbsmartphones. Android is great, and I love my Hero, but I honestly can't see the average user liking android over WebOS or the iPhone's OS.
@MattEL A good try? Man, people here sure like to count things out.
The only thing wrong with Palm, is Palm itself, Why are they not selling an unlocked quadband gsm version online? I mean why not? If they can't make carrier agreements fast enough to save themselves, why not rake in the cash? I would have bought a palm pre gsm unlocked direct from palm
In other countries, thats how it works, you buy the phone unlocked and you just pay for the sim and buy update cards.
I really wish that Palm had built WebOS as a heavy Android customization instead of building their own from scratch. I'm really in love with the way they've designed their card system, and I think they're the only ones out there doing multitasking right, but they just can't compete with Android for app selection.
Plus, I write a lot of personal apps for my smartphones and there's just no way in hell I'd be willing to torture myself by doing it in Html and Javascript.
palm need to make its move to Verizon, STAT!
Two questions for Palm:
1. Are Palm selling Pre´s faster than they can make them ?
2. Can I, a rich European consumer, buy a Pre in my market ?
If you answer No and No, then you have FAILED.
@journalismnazi As a rich European consumer you can buy an unlocked GSM Palm Pre or from one of your local carriers. Though since you are rich, you can definitely afford to buy one unlocked.
@Xudd
No, I cannot buy an unlocked Palm Pre because they are not available in my country. That is my point. Duh.
Are you just randomly replying to posts which you nothing about for fun ?
People are, and have been with Sprint primarily because of their good pricing plans.
Yes, Sprint's customer service and call quality has improved drastically, but for years, people were willing to put up with Sprint's rotten customer service and horrible reception only because of their good pricing and flexibility.
It is my humble opinion that Sprint has lost an opportunity to sell thousands, (perhaps hundreds of thousands,) of Pre's, by limiting the Pre to the higher pricing plans, thus leaving behind all their long standing customers. Not only their thousands (perhaps even a million+, who knows?) of SERO customers, but also hundreds of thousands of customers who have been with long standing excellent family plans and individual plans.
The argument that "AT&T has expensive plans for Iphone" has no place here, because people are NOT with AT&T primarily for the pricing. I have been with AT&T, and have been paying almost the same amount for other phones with their data plan. So when AT&T says that it will run you 80 bucks a month, AT&T customers will go for it. There is also no place for the argument that "Sprint offers the best package for $79", because, no matter what they pack in for that price, at the end of the day it is still 80 bucks, and not 30 or 40.
@Zale
Here we go with the SERO whiners again.
As a former SERO account holder who jumped ship for the Pre let me be the first to say - get over it brah.
why on earth they haven't announced a tablet format phone is beyond me... how hard is that?
Palm's greatest mistake was wasting 2 years on the Foleo and not hiring John R. earlier.
I really hope palm ends up doing good, I honestly think webOS is the best mobile OS out there.. I am still not ready to switch from android, but I feel like I will someday if they can come out with a phone with the right hardware for me.
@cherryboom
hey guys cherryboom was right! We are all in your debt cherryboom. Can I paypal you some dough for your terrific insight into the mobile phone landscape?
"Palm's specifically saying that they're looking to grow carrier and geographic coverage"
Hey Palm, how about releasing the damn phone in Australia and Singapore?
I've only been waiting a year to get my hands on a WebOS device. As someone who kind of needs a new phone, Android is starting to look mighty attractive. And those 2 year contracts will mean there's quite a long time to wait before I can look at a WebOS device again.
Move now, or ... don't.
Would have bought a Pre if it was available unlocked with GSM radio. Now it's to late and I enjoy my N900...
It's ok Palm. it could be worse...
Looks at Nokia...
@Wesscoast
How?
http://www.nokia.com/about-nokia/financials/quarterly-and-annual-information/q3-2009
Nokia made far more profit in handsets than Palm did.
The only reason for their negative results was Nokia-Siemens, that doesn't sell phones.
way to go cherryboom! Your insight befalls us; good job, bro!
That short-term cash and investments is mostly from their stock offering in November, worth some $300M+. The stock is tanking after hours, right now losing some $.084 (-7.17%).
They actually sold 30% FEWER phones (573K compared to 810K) this quarter compared to last, which means that the shrinking loss is partly a result of cutting back on expenses, aka layoffs and smaller budgets.
@cherryboom
let me break some news to you: no one cares more about the fact that you think you're right than yourself.
kbye.
Boo, I was hoping they would dominate the post!
Sounds like the current administration: "hey we only lost this many jobs this month! YAY!"
Palm is dead in the water unfortunately. Really like web os and all, but since so much was ridding on the pre and it did not deliver, consumer interest in the brand has diminished.
The first problem, as said, was launching just on Sprint. If they did both Sprint and Verizon before the Android devices took off, we'd be looking at a winner. I'm not sure why they're going with the Pixi and not the Pre on Verizon. Maybe Verizon told them "you had your chance, now we're sticking with Google" and don't want to take away from the Droids market share. Putting the Droid against the Pre interface and design wise, I think most average users would take the Pre. It's just "friendlier". The Droid appeals to the geek in us, but there isn't anything smooth or friendly about it. I really hope Palm can keep it together. I really like what they've done with the Pre (I'm still on my first one), but with HTC behind Google ... this may not end well.
It's always a bitter pill when the immediate results aren't totally stellar, but compared to the same time last year, even in this environment, with Android, RIM, and Apple, they have made a significant improvement year over year. Trying to take the long view, it makes sense that they continue to refine WebOS even further and expand the carrier coverage. The updates for WebOS come out with unrivaled frequency because they are a small company with only 2 products that they're devoted to. It makes sense to pack light (few devices) so they can continue to move fast.
And even so I would still pick the Pre over an Android device including the Droid in terms of fit and finish of the OS. When it arrives on VZW, It'll be a solid choice there. Isn't that sorta incredible considering how small they are in comparison to the monoliths?
They've got investor backing. This is a marathon, and they truly haven't stumbled yet. In fact, you could argue that they may have weathered out the hardest mile already. WebOS is available.
Funny, when Nokia slips market share (and by the way, they are still number 1 in the world) theres a BIG picture with a bloody finger print here. When Palm or Apple(maybe in the future, who knows?!) posts a loss... We get a normal logo?!
Come on guys, you can photoshop better right?
ps. I hope Nokia dont buy this dead horse.
pre looks great,but the web os seems not developing smoothly, the apps with high price and low quality are really diappointing..