With Palm recording a net loss of $22 million during its fiscal Q3, due in part to smartphone sell-through declining 29 percent compared to the previous quarter, the manufacturer vowed to continue working to improve its webOS platform and to create a more attractive environment for developers. Speaking on Palm's earnings call last week, CEO Jon Rubenstein admitted "Our recent underperformance has been very disappointing, but the potential for Palm remains strong. The work we're doing to improve sales is having an impact, we're making great progress on future products, and we're looking forward to upcoming launches with new carrier partners. Most importantly, we have built a unique and highly differentiated platform in webOS, which will provide us with a considerable--and growing--advantage as we move forward."
Palm sold just 408,000 smartphones in Q3, and Morgan Stanley analyst Ehud Geldblum estimates that the glut of webOS devices currently stuck in channel inventory could total an "alarming" 1.5 million units. Palm CFO Doug Jeffries said the company will focus on "helping carriers work down their substantial inventories" during the current quarter. According to Rubenstein, if webOS smartphones had gone on sale at Verizon Wireless prior to Motorola's blockbuster Droid, Palm's overall health would be much improved: "If we could have launched at Verizon prior to the Droid, I think we would have gotten the attention the Droid got," he said. "And since I believe we have a better product, I think we could have even done better."
In the meantime, Palm said it is working hard to improve webOS products--since the operating system debuted nine months ago, the manufacturer has pushed out 10 over-the-air updates to enhance core applications, increase battery life and accelerate response times. Palm also hopes to encourage more developer interest in webOS--its Palm App Catalog storefront now features about 2,000 applications, far behind rival efforts like Apple's App Store (150,000 applications) and Android Market (30,000 apps). Last week, the Palm Developer Center Blog announced a new video podcast series spotlighting Palm news, walkthroughs on building and distributing webOS apps, tips and tricks from Palm engineers and insight from third-party developer partners.
For more on Palm's next steps:
- read this PCWorld article
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Palm unveils webOS 1.4
Palm App Catalog finally tops 1,000 webOS applications
Palm doubles size of webOS developer community