Palm posted disappointing financial results Monday, swinging to a loss for the first time since 2003.
During the company's first fiscal quarter of 2008, which ended Aug. 31, Palm recorded a net loss of US$800,000, compared with net income of US$16.5 million last year. Smart phone revenue was up 21 percent, but overall revenue was up just 1 percent from US$356 million last year to US$361 million this year.
Much has been made about the effect of the iPhone on Palm, but that is not its only problem.
Everyone is passing Palm by these days as the company has been slower than rivals such as Research in Motion, Nokia, and others to introduce updated designs. It recently launched the Palm Centro to try to recapture some momentum, but the impact of that launch will not be felt until next quarter.
Perhaps that is why Palm spent so much into research and development during the past quarter, spending US$53 million compared with US$41 million last year. But things are not going to get much better during the next quarter, as Palm forecast that both revenue and profit would fall well below Wall Street's expectations.
This article was first published as a blog post.
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