What Palm's Sorry Sales Really Mean

Palm's results for last quarter are out, and they're grim. Not as grim as Palm had warned, but still. What does this mean to you, loyal Palmsters? It means your beloved company - and its phones-might get gobbled up.

When a quarterly report requires a warning, like this one does, the news can't be great. And it wasn't. Palm lost $US22m last quarter, which isn't huge money for a company with revenues of a few hundred million, but is pretty serious for a company that's still in recovery mode. They shipped an (again, OK) 960,000 phones this quarter, but only about 400,000 of them actually sold - 30 per cent less than last quarter.

CEO Jon Rubinstien's keeping a strong face:

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.

And he's right: webOS is the most valuable thing they have - in a buyout situation.

Palm's running out of options as Palm. And the prospect of a buyout isn't just a tech world fantasy, or armchair economic analysis: Apparently, the few Wall Street analysts who've stuck with Palm through the last six months are starting to bail, and the last remaining holdouts are literally banking on a buyout.

A Palm buyout could mean a lot of things, from a transparent absorption into a company that needs a mobile phone presence (HP?) to a full on cannibalisation for intellectual property (Google?). The question now is less of an if than a when, and less of a when than a who. Place your bets in the comments. [Palm]

Trending Stories Right Now