PalmOne lays off 12 percent of workforce

  • Tom Krazit (IDG News Service)
  • 23 January, 2004 07:30

About 100 employees of PalmOne lost their jobs Wednesday, as the company shifts operations toward the smart phone market after acquiring Handspring earlier this year, PalmOne said in a release.

The 100 employees represent about 12 percent of PalmOne's workforce, the company said. About 740 workers remain with the company after Wednesday's announcement, it said.

Virtually all the employees worked at PalmOne's Milpitas, California, headquarters, said Marlene Somsak, a company spokeswoman. Two engineering teams for wireless products and handheld products bore the brunt of the job losses after they were consolidated into a single group, she said.

PalmOne leads the market for PDAs (personal digital assistants) with its Tungsten and Zire products, but handhelds that offer voice capability as well as storage for contacts and calendar information are expected to grow much faster than unconnected PDAs, according to analysts.

The company acquired Handspring last year for its Treo 600 product. That smart phone has been well received by analysts and reviewers, as well as users, and gives PalmOne a foothold in the smart phone market.

Last June, PalmOne said that 125 employees would lose their jobs in the combined company. About 75 Handspring employees left that company between the June announcement of the acquisition and the October shareholder vote to confirm the deal, Somsak said.