Palm downgrade revenue expectations over "slower than expected" sales
Palm have sheepishly updated their revenue guidance figures for the third fiscal quarter of 2010, blaming "slower than expected consumer adoption of the company's products" – also known as "people not realising they really, really need a Palm smartphone" – for the shortfall. According to the press release, lower than expected demand has led to carriers deferring deliveries of webOS devices, and will result in 2010 revenues being "well below" the $1.6bn to $1.8bn initially predicted.
"Driving broad consumer adoption of Palm products is taking longer than we anticipated" Palm CEO Jon Rubinstein is quoted as admitting, though he insists that carriers are still committed to the Pre, Pixi, Pre Plus and Pixi Plus lines. Full results will go public come March 18th.
Press Release:
Palm Updates GuidanceSUNNYVALE, Calif.–(BUSINESS WIRE)–Palm, Inc. (NASDAQ:PALM) today indicated that it expects that revenues for the third quarter of fiscal year 2010 will be in the range of $285 million to $310 million on a GAAP basis and in the range of $300 million to $320 million on a non-GAAP basis.1 Revenues for the quarter and full year are being impacted by slower than expected consumer adoption of the company's products that has resulted in lower than expected order volumes from carriers and the deferral of orders to future periods. Accordingly, Palm expects fiscal year 2010 revenues to be well below its previously forecasted range of $1.6 billion to $1.8 billion. The company will provide more detail on its financial results during Palm's third-quarter financial results conference call currently scheduled for Thursday, March 18.
"Palm webOS is recognized as a groundbreaking platform that enables one of the best smartphone experiences available today, and our work to evolve the platform and bring industry-leading technology to market continues. However, driving broad consumer adoption of Palm products is taking longer than we anticipated"
"Palm webOS is recognized as a groundbreaking platform that enables one of the best smartphone experiences available today, and our work to evolve the platform and bring industry-leading technology to market continues. However, driving broad consumer adoption of Palm products is taking longer than we anticipated," said Jon Rubinstein, chairman and chief executive officer. "Our carrier partners remain committed, and we are working closely with them to increase awareness and drive sales of our differentiated Palm products."
The Company expects to close its third fiscal quarter with a cash, cash equivalents and short-term investments balance in excess of $500 million.
Notes for Palm Investors
Palm will announce its third-quarter fiscal year 2010 financial results on Thursday, March 18, shortly after 4 p.m. Eastern (1 p.m. Pacific), followed by a conference call for the public at 4:30 p.m. Eastern (1:30 p.m. Pacific). The conference call will be hosted by Jon Rubinstein, chairman and chief executive officer, and Doug Jeffries, chief financial officer. Investors and other interested parties are encouraged to listen to the call via audio webcast at Palm's Investor Relations website (http://investor.palm.com). Investors wishing to listen to the conference call via telephone may dial 877-278-9658 (domestic) or 763-488-4651 (international). There is no pass code required for the live call. A telephone replay of the conference call will be available through April 1, 2010. The dial-in number for the replay will be 800-642-1687 (domestic) and 706-645-9291 (international). The pass code 58326338 is required for the replay. An archive of the audio webcast of the conference call will be posted on Palm's Investor Relations website at http://investor.palm.com.