Palm has been forced to revise its initial sales forecast due to stiff competition from RIM and Apple.
According to Bloomberg, the corporation had originally projected sales of at least $1.6 billion for the year ending in May; however, revenue during the fiscal third quarter is expected to hit only $310 million at most.
Lawrence Harris, an analyst with CL King & Associates, told Bloomberg that Palm is “still struggling” to resurrect its reputation as a smartphone innovator.
Nevertheless, the company has failed in wooing customers with its touch-screen Pre and other models and needs to “broaden its offerings” to succeed.
“The situation for Palm is rather serious right now and they need to develop new products,” said Harris.
“The magnitude of the shortfall is fairly significant.”
But Morgan Joseph analyst Ilya Grozovsky told the Wall Street Journal that Palm had a “cushion” which would allow it to maintain operations and even design a number of new products.
“They probably have another two swings left. [Still], this is clearly a strike.”