Palm loses $506 million, sees drop in revenue

Palm, as it struggles to find its footing in the smartphone market, posted a $506.2 million loss for its fiscal second quarter, and saw a steep drop in revenues.

The large loss was primarily related to a $396 million write-down of deferred tax assets. The company posted revenues of $171 million, down 39 percent from the year-ago period, and below even a lowered expectation that Palm had set earlier this month. Palm had expected revenues of between $190 million and $195 million, which itself was a steep drop from previous Wall Street expectations. Palm shipped 599,000 smartphones for the quarter, a 13 percent drop from the year-ago period.

As competition from Apple and Research In Motion has grown more intense, the company has struggled to deliver a product line that can compete with the iPhone 3G or RIM's BlackBerry devices. Palm, which has been banking on sales of its Centro smartphone to keep it afloat, has pinned much of its hope for a revival on the launch of its new operating system, Nova, which it is set to unveil at the Consumer Electronics Show in Las Vegas next month.    

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