Nobody really expected Palm to turn a profit this quarter, but this is still pretty bad: In the second quarter after the Pre's launch, Palm lost $85m. This does mark an improvement, depending on how you spin the numbers.
Specifically, if you jump back a year to Q2 2008, when Palm lost an astonishing $508m—no small feat for a company that shipped less than half a million phones during the period—things are downright rosy right now. If you look back to Q1 of this year, though, not so much:
The company shipped a total of 783,000 smartphone units during the quarter, representing a 5 percent decrease from the first quarter of fiscal year 2010
Despite launching a second phone and expanding their international reach with more carriers, Palm's sales have slowed over the last few months, not picked up. CEO Jon Rubenstein is stil optimistic, but that's his job:
We are continuing to execute strongly against our long-term strategy with the delivery of Palm Pixi, the new carrier launches completed this quarter, and the upcoming opening of Palm's full developer program. We're still in the early stages of a long race, and we're energized by the opportunity to compete in this exciting market.
It doesn't take a genius or an insider to know what's wrong with the Pre—its lack of serious app development means that people view it as more of a feature phone than a smartphone—and Rubenstein clearly knows this, and the webOS concept still has a ton of potential. But this is an issue of dollars: if Palm can't start turning this potential into real cash, it'll never get fully realized. Rumors of a Verizon rollout are promising, but they're not a sure thing. And alone, they probably wouldn't be enough—the Pre and Pixi aren't riding on particularly new tech, so Palm needs something fresh to remain a serious competitor.