Palm stock plummets after poor sales force company to lower guidance

Posted:
in iPhone edited January 2014
Palm's stock tumbled more than 19 percent Thursday after the handset maker decreased its forecast for third-quarter sales dramatically, citing lower-than-expected demand for its smartphones.



Palm said it expects its sales to be between $285 million and $310 million, well below its previous forecast of $1.6 billion to $1.8 billion. Palm chief Jon Rubinstein said that "broad consumer adoption of Palm products is taking longer" than he and his company had anticipated.



"Our carrier partners remain committed, and we are working closely with them to increase awareness and drive sales of our differentiated Palm products," he said.



According to Forbes, analysts had on average expected Palm to report sales of $424.9 million when it releases its third-quarter earnings on March 18.



Wall Street did not respond well to the news, with the company's stock dropping $1.56, or 19.28 percent, to 6.53 by the closing bell on Thursday.



Palm recently expanded its Pre and Pixi smartphones beyond carrier Sprint to Verizon, with the exclusive Pre Plus and Pixi Plus. The company also has plans to release two devices based on the WebOS mobile operating system on wireless provider AT&T, the exclusive carrier of Apple's iPhone in the U.S.



Palm turned heads in 2009 when it unveiled WebOS with a surprise announcement, earning positive reaction and buzz from the press.



Rubinstein served as Apple's iPod chief until 2006, when he formally retired from the company. In 2007, he was courted by Palm to serve as its executive chairman, and he officially took the role of CEO last summer, coinciding with the launch of the Palm Pre.



Though the Pre got off to a strong sales start, it has failed to gain significant market share in the mobile space.
«134

Comments

  • Reply 1 of 71
    Palm Pre was always buyout bait.



    Just a matter of time.



    Funny thing is, MDN called this from day one. Say what you will about crazy MDN, but they're usually right. Part of it comes naturally from backing the winning horse, and the rest . . . might just be uncommon prescience after all.
  • Reply 2 of 71
    Too little, too late! 'Another one bites the dust!'
  • Reply 3 of 71
    eriamjheriamjh Posts: 1,351member
    Palm is dead. Long live Apple.
  • Reply 4 of 71
    I had a Palm Pilot PDA in, I think, 1997 or so...man I thought it was the bee's knees! Sitting there with my stylus inputting contact names, phone numbers and addresses. Plus making 'to do' lists, ad nauseam under the false pretense that I was getting organized and therefore 'productive!'



    Good times!
  • Reply 5 of 71
    I cry crocodile tears
  • Reply 6 of 71
    sflocalsflocal Posts: 5,853member
    It's sad to see a once proud company on the verge of tripping into their grave. I did Palm development for many years back in the day. When they abandoned PalmOS and left it hanging for basically years, they lost me and a lot of other developers. Those monkeys running the company back then took the money and ran.



    I knew people at Palm asking me and other developers to return developing for them when the Pre has just been announced. Because of the way their shop treated the people that made them successful, I told them their platform was doomed and I refused to do anything for them. Thankfully, I'm still friends with those people and of no surprise, a few months after they tried to sway me to develop for them, those same Palm folks quit the company as they saw the writing on the wall.



    Such a shame. The worst part is that the executives that ruined Palm are working elsewhere and certainly in my belief, fabricating stories that makes it sound like they had nothing to do with its demise.



    Good riddance Palm. You'll go down in history as how BAD management can ruin a great company.
  • Reply 7 of 71
    indeed. too little, too late. they have nothing to leverage. no direction to grow beyond making ever cheaper phones. of course you need people to buy them if you want to keep making them.
  • Reply 8 of 71
    If I remember correctly, along time ago there was a story I read where the CEO/Founder of Palm walked around for months with solid piece of wood in his jacket pocket which was about the size/weight of the Palm Pilot PDA that was under development.



    Palm was fortunate to have him...thank goodness we have Stevo....
  • Reply 9 of 71
    First...

    Gateway

    Circuit City

    Nextel

    Cingular

    Alltel



    **********

    Next....

    Palm

    Sprint

    Blockbuster (for sure)

    Motorola (mobile cell phone division/offshoot)?



    I'm sure I'm forgetting a lot!
  • Reply 10 of 71
    nasseraenasserae Posts: 3,166member
    I told you so. Rubinstein is busy trying to be Steve Jobs that he forgot Palm is not Apple. Beside this is what you get for going head to head with everyone else instead of making partners. Furthermore, they should have spent more time improving their products instead of trying to crack iTunes. And who in their right mind release a phone the same month Apple release the iPhone?!
  • Reply 11 of 71
    Quote:
    Originally Posted by sflocal View Post


    It's sad to see a once proud company on the verge of tripping into their grave. I did Palm development for many years back in the day. When they abandoned PalmOS and left it hanging for basically years, they lost me and a lot of other developers. Those monkeys running the company back then took the money and ran.



    I knew people at Palm asking me and other developers to return developing for them when the Pre has just been announced. Because of the way their shop treated the people that made them successful, I told them their platform was doomed and I refused to do anything for them. Thankfully, I'm still friends with those people and of no surprise, a few months after they tried to sway me to develop for them, those same Palm folks quit the company as they saw the writing on the wall.



    Such a shame. The worst part is that the executives that ruined Palm are working elsewhere and certainly in my belief, fabricating stories that makes it sound like they had nothing to do with its demise.



    Good riddance Palm. You'll go down in history as how BAD management can ruin a great company.



    Very well said...Most companies end up this way after the first generation of leaders leave! There are more Mervin's, Gateways and Circuit City's than Fords, McDonalds and Coke's in this world.



    Not to belabor the point, but there's a bird that resides in the Sahara that descends to it's nest located on the ground from a very high altitude in ever decreasing circles, (looking for possible predators)....b/c the bird is so well camouflaged when it does indeed land it seems to 'disappear!' The old adage is that it has flown 'ever decreasing circles' until it flies up its own a**hole!



    This is what Palm is doing! And to a lesser degree so is MS....Most businesses are 'in the business' of going out of business because of mis-management!



    Ps. Please feel free to use the above analogy the next time you get the occasion to talk to your CEO!
  • Reply 12 of 71
    Palm did many things right with Web OS, arguably the best looking UI out there.



    But it also screwed up royally on key fronts, such as choosing Sprint for the initial launch (should've been Verizon Wireless), not having an SDK or app store at launch, keyboard and build quality issues, Pixi and Pre not being fully compatible app wise, and iTunes sync fiasco. Meanwhile, the market became super crowded and competitive with Android and soon-to-arrive Windows Phone 7.
  • Reply 13 of 71
    No biggie, just getting ready for the big Apple purchase!
  • Reply 14 of 71
    mactelmactel Posts: 1,275member
    Quote:
    Originally Posted by NasserAE View Post


    I told you so. Rubinstein is busy trying to be Steve Jobs that he forgot Palm is not Apple. Beside this is what you get for going head to head with everyone else instead of making partners. Furthermore, they should have spent more time improving their products instead of trying to crack iTunes. And who in their right mind release a phone the same month Apple release the iPhone?!



    That's all true. Palm does not have the product depth that Apple does. They should have licensed Android and gone in that direction. Their expenses would have been lower. What have they gained by creating a totally new OS? At least Apple spreads its OS development costs across all of its segments.



    Let's hope Motorola, RIM, or Nokia buys Palm before they fold. Apple doesn't need them but could extend offers to their developers and engineers. Call it an unofficial ex-Apple employee amnesty plan. Microsoft did it after the dot-com bust of the late 90s early 2000s bringing back many ex-Microsofties. They'd get the cream of the crop without actually buying Palm.
  • Reply 15 of 71
    rainrain Posts: 538member
    Quote:
    Originally Posted by filburt View Post


    Palm did many things right with Web OS, arguably the best looking UI out there.



    I have to agree. I got a chance to play with a Pre once and was blown away by the UI. It looked like something Apple might develop 7 years from now. Very intuitive, the way it handled multi-taksing was quite remarkable.

    I wouldn't be surprised if Apple makes a play for Palm.
  • Reply 16 of 71
    cu10cu10 Posts: 294member
    Quote:
    Originally Posted by christopher126 View Post


    I had a Palm Pilot PDA in, I think, 1997 or so...man I thought it was the bee's knees! Sitting there with my stylus inputting contact names, phone numbers and addresses.



    I still do that, on my Clie. Calendar, contacts, and some apps.



    Quote:
    Originally Posted by sflocal View Post


    ...I did Palm development for many years back in the day. When they abandoned PalmOS and left it hanging for basically years, they lost me and a lot of other developers.



    Too bad, and Sony suddenly discontinued their excellent Clie line. People can still write 68k code on Palms; it makes for a good hobby platform.
  • Reply 17 of 71
    elrothelroth Posts: 1,201member
    Quote:
    Originally Posted by rain View Post


    I have to agree. I got a chance to play with a Pre once and was blown away by the UI. It looked like something Apple might develop 7 years from now. Very intuitive, the way it handled multi-taksing was quite remarkable.

    I wouldn't be surprised if Apple makes a play for Palm.



    Can you imagine Jobs and Rubinstein negotiating a buyout? Priceless.
  • Reply 18 of 71
    You lost me when you abandoned PalmOS for Windows Mobile. Yuck.
  • Reply 19 of 71
    solipsismsolipsism Posts: 25,726member
    Quote:
    Originally Posted by filburt View Post


    Palm did many things right with Web OS, arguably the best looking UI out there.



    But it also screwed up royally on key fronts, such as choosing Sprint for the initial launch (should've been Verizon Wireless), not having an SDK or app store at launch, keyboard and build quality issues, Pixi and Pre not being fully compatible app wise, and iTunes sync fiasco. Meanwhile, the market became super crowded and competitive with Android and soon-to-arrive Windows Phone 7.



    I agree on all points but one and I"d like to add another point that helped this potential win for Palm ultimately fail.



    1) I think the syncing with iTunes was a good strategy because the people buying the Pre likely weren't buying the iPhone anyway, but it did give Palm a lot of free press. I knew BB users that had no idea RiM made an app that will sync with your iTunes library, but everyone know that the big bad giant wasn't letting the little guy have a chance by illegally (haha) pushing Palm out of the ubiquous iTunes.



    2) The part I'd add is the release date, which does go along with your other points but should be stated directly. The oddly wanted to beat Apple's 3rd iPhone to market, yet they should have waited well into Fall or Winter to release the Pre with good HW, a well tested OS, a proper webcode-based SDK since it's a webcode-based OS and apps, at the opposite end of the iPhone hoopla.
  • Reply 20 of 71
    Palm did so many things wrong.



    1) Palm Pixi. Why? Should have stayed with just one model, the Pre. Didn't they know about economies of scale? And developed the SDK and App store earlier.



    2) Should have partnered with somebody with deep pockets and market presence. Microsoft or Dell.



    3) Should have gone with Verizon first. But, Verizon would have screwed them.



    Roger McNamee, what a fool, he !!
Sign In or Register to comment.