Dark clouds have gathered around Palm, after it halved its fourth quarter revenue outlook for the second time due to poor device sales, sending its stock down over 20 per cent, and leading analysts to wonder if the handheld computer maker would run out of cash by year's end.
The warning was compounded by Palm's announcement that the cooler economy has forced the termination of its planned purchase of software company Extended Systems - a key step in Palm's strategy to grow sales to corporations.
Hurt by delays in the debut of its new, pricier high-end models, and a glut of older, cheaper devices, cut revenue forecasts for its fourth quarter, which ends in May, to between $140 million and $160 million, from $300 million to $315 million previously. Analyst had in March believed Palm would score revenues near $600 million.
