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Palm sets plans for more layoffs

Palm sets plans for more layoffs

Handheld computer maker Palm plans to lay off an undisclosed number of workers later this month, its second cutback in recent weeks, due partly to an earlier delay in the release of its latest personal digital assistants.

The planned layoffs are "not any kind of restating of expectations," said Palm spokeswoman Marlene Somsak. She added that the disclosure of the upcoming cuts "was not anything like a pre-announcement" of results for the company's fiscal fourth quarter, which ends today.

Somsak said the reason for the layoffs was Palm's poor performance in its third quarter ended March 2, which was caused at least in part by the delay in shipping the company's new m500 series devices. In the softening economy, she said, customers delayed purchases to wait for the next upgrade. When it was late, inventory for Palm's older devices backed up while the new model wasn't yet on the market.

According to Friday's announcement, "the company expects to provide more information about [this] workforce reduction when it announces fourth-quarter results during the week of June 25."

The m500 devices are now available, and Palm CEO Carl Yankowski said in a statement that efforts to improve the company's execution in engineering, manufacturing and logistics "are beginning to show results." But Palm noted that the new layoffs are needed to bring its internal costs "in line with business conditions."

The news comes a day after a company that Palm had hoped to buy also announced that it was streamlining operations and cutting its workforce. Extended Systems, a developer of mobile information management software, said it will lay off 15 per cent of its workforce, or 50 employees and contractors, after a planned deal to be acquired by Palm fell through last month.

In April, Palm said it would cut its workforce by 13 per cent, or about 250 employees and contractors, and make other cutbacks in response to a reduced revenue outlook and an expected fiscal fourth-quarter loss. The company, which had about 1,900 employees at that point, disclosed today that about 300 people were actually let go in the first round of layoffs.

In addition, Palm Friday announced the hiring of Todd Bradley as the new chief operating officer of its Solutions Group. Bradley, formerly executive vice president of global operations at Gateway, was selected in a search process that began in December, Somsak said.

In a separate announcement Friday, Palm signed a deal to license its operating system to Taiwan-based computer manufacturer Acer. Palm and Acer will work together to develop traditional and simplified Chinese-language versions of the Palm OS platform for customers in the Asia-Pacific region, the statement said.


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