Yankowski Admits Mistakes to Shareholders
Palm held an event today that the company CEO has probably been dreading for some time: their annual shareholders meeting. Carl Yankowski had the unenviable job of explaining why the company's stock price has dropped so steadily over the past year.
According to Cnet, he said some of the blame could be placed on the worsening economic situation, but "We also made mistakes."
This was in reference to the company announcing the m500 series long before it was available, which dried up demand for their current products. This severely hurt their cash flow during the second quarter of this year. They also committed to taking large shipments of parts needed to product handhelds at a time when demand was slowing, which left them with millions of dollars worth of unsalable inventory.
Still, Mr.Yankowski says the company is turning itself around. "We know where we erred...We know what needs to be done to turn the corner...and we've begun." The company has cut operating costs by about 25% and reduced the amount of inventory it has in the channel. In its most recent quarter, revenues were up 30%. While the company expects to take another small loss this quarter, they are hopeful of returning to profitability shortly thereafter.
There was one bright spot in the day. Palm's stock price rose almost 40% today, though that's only to $2.09. The high for the stock in the past year has been $67.38.
All this has gone on against a backdrop of a slowing U.S. economy which has led to decreased demand for all types of computers.
At the shareholders meeting, Palm also showed off some ads that will begin appearing in the near future.
One, aimed at corporate buyers, has the theme that the Palm OS has the lead over the Pocket PC OS in software and is more popular users and Chief Financial Officers.
The company also intends to have a consumer-oriented ad campaign during the holiday season that emphasizes the advantages of the SD slot.
Handspring has also had a bad year and will be releasing its most recent quarterly figures next week.
Thanks to Ravdeep for the tip. -Ed
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