In light of the bad financial news coming from Palm, CEO Jon Rubinstein took the opportunity to shore up the confidence of Palm employees. He sent a company wide email that outlines what the company is doing to get fully back on track.Palm's recent revised earnings have caused the company's stock to drop further to an abysmal $6.53 per share as of the closing bell yesterday. That's down over 60% from its most recent high, which it reached in October. Analysts -- and the press -- have come down on the firm hard for its sagging sales of webOS devices. Many ponder the firm's future.
Knowing that Palm's employees are likely doing the same, CEO Jon Rubinstein decided to take action in the form of an email. It was sent to Palm employees yesterday. The message, in sum, is that "we'll get there...eventually." Rubinstein highlights several new tactics the company is taking to spur the adoption of webOS devices, which include new marketing campaigns with network operator partner Verizon Wireless. Rubinstein says that the efforts appear to be paying off, if slowly.
Here's his full email to Palm employees:
This morning we announced preliminary results for our 2010 third quarter. Since the quarter has not yet closed, it is too soon to offer exact numbers, but we stated that we expect to report revenues for Q3 between $300 and $320 million. We also announced that we expect our revenue for this fiscal year to fall below the guidance we gave to Wall Street, which ranged from $1.6 to $1.8 billion. As we mentioned in our press release, our softer than expected performance is due to slower than expected customer adoption of our products, which in turn has prompted our U.S. carrier partners to put additional orders on hold for the time being. On a positive note, we expect to exit the quarter with over $500 million in cash on our balance sheet. We're scheduled to announce our full financial results in March.
I realize this news is difficult to swallow. We made this announcement today to prevent a surprise for Wall Street when we announce quarterly earnings in March. In the meantime, the entire executive team has been working extremely hard to improve product performance, and have implemented a number of initiatives to increase awareness and drive sales.
Dave Whalen and I just returned from a very successful meeting with Verizon Wireless, where they acknowledged that their execution of our launch was below expectations and recommitted to working with us to improve sales. To accelerate sales, we initiated Project JumpStart nearly three weeks ago. Since then, nearly two hundred Palm Brand Ambassadors, supplemented by Palm employees from Sunnyvale, have been training Verizon sales reps across the U.S. on our products. Early results from the stores have already shown improvement on product knowledge and sales week over week. You may have also seen a growing number of Palm ads on billboards, bus shelters, buses, and subway stations-all getting the word out about Palm.
All of these efforts are examples of how we are working to accelerate adoption and grow distribution of webOS. In the next few weeks, your management will work with you to make sure your priorities are laser-focused, primarily on helping to increase sales, improve product quality and differentiate the Palm product experience.
Our goals are taking longer than expected to achieve, but I am still confident that our talented team has what it takes to get the job done.
We'll schedule an all-hands meeting after our earnings announcement in March, and I'll be happy to answer your questions.