As predicted, Palm's revenue plunged dramatically as the company prepares for the release of its highly anticipated Pre smartphone. Palm reported its fiscal third quarter results ending Feb. 27 yesterday and said that it lost $98 million compared to a loss of $57 million a year earlier. Excluding special items like stock-based compensation and restructuring charges, the company lost $94.7 million. In addition, its smartphone revenue fell 72 percent to $77.5 million. Total revenue for the company was $90.6 million compared to analysts' forecasts of $105 million.
Earlier this month Palm warned that it would have weaker sales in its fiscal third quarter, as demand for existing smartphones in its portfolio dropped in anticipation of the release of its newest product, the Pre.
Palm is expected to launch the Pre sometime in the first half of the year. Sprint Nextel will have exclusive carrier rights to the device in the United States. Palm is pinning much of the future of the company on the success of the device, which combines users email inboxes, messaging conversations and contact lists into individual programs in its WebOS.
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