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WSJ Posts Palm CEO's Letter to Employees

The Wall Street Journal has published a memo sent out to all Palm employees today by CEO Jon Rubinstein. The letter goes into more detail behind they days financial readjustment press release and provides some background on Palm's current initiatives to drive sales. The letter also discloses that Verizon felt the webOS launch was below expectations, but remains committed to working with Palm.

The full letter is posted at this Digits blog post at the WSJ and is mirrored below.

Team,


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.

Go team!!!

jon

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Captain is going down with his ship

Gmon750 @ 2/26/2010 1:07:30 AM # Q
Bye-bye Palm. You've abandoned us developers years ago while management took the money and ran. You asked us to come back to the "new" Palm but the bitterness remained and management's sloppy practices were still there. We saw the writing on the wall.

You once shined brightly but now, the incompetencies have have finally caught up to you and done you in.

It would be wise for anyone from management to not list Palm on their resume. That alone would have me file it in the circular file cabinet.

From a former Palm-developer, you will not be missed. Good riddance.

RE: Captain is going down with his ship
jca666us @ 2/26/2010 5:31:21 AM # M Q
Project JumpStart?? Lmmfao!!!

Unbeknownst to Ruby, Palm employees have begun initiating Project JumpShip.

This is going to get interesting...

RE: Captain is going down with his ship
rpa @ 2/26/2010 7:56:26 AM # Q
What does he mean by "Go Team!!!"? Is he sending a subliminal message to start sending out resumes?
RE: Captain is going down with his ship
jca666us @ 2/26/2010 12:59:42 PM # M Q
Go Team!!! - can't forget the exclamation points.

Ruby is telling everyone to work harder (as if they aren't already) while he decides who to layoff in order to save cash.

What a putz!

With his bleeding edge management skills, it's easy to see why Apple drop-kicked him.

RE: Captain is going down with his ship
Gekko @ 2/26/2010 1:49:49 PM # Q

Apple hasn't skipped a beat since they got rid of this putz.


RE: Captain is going down with his ship
e_tellurian @ 2/26/2010 3:07:23 PM # M Q
Has anyone hear been involved in bringing new thoughts to market?

E-T

RE: Captain is going down with his ship
e_tellurian @ 2/26/2010 8:24:10 PM # M Q
As mentioned before Palm is a pioneer there intellectual contribution to the industry is very valuable and does not reflect in the value of Palm as it should.

E-T

RE: Captain is going down with his ship
jca666us @ 2/28/2010 8:46:42 AM # Q
This pic. is hilarious: http://tinyurl.com/yjcgtyv
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Guess the OTR Global reports was absolutely correct, eh?

SeldomVisitor @ 2/26/2010 5:11:06 AM # Q
This memo says Palm was running around like a chicken with no head a week BEFORE the OTR Global report came out saying Palm suddenly stopped production with no ETA a few days before Chinese New Years.

So why did Palm release that fluff about "in anticipation of the Chinese New Years" at all?

Bet the answer is more interesting than anything already out.

RE: Guess the OTR Global reports was absolutely correct, eh?
Gekko @ 2/26/2010 5:44:35 AM # Q

"Chapter 1... Page 1... Paragraph 1: What is the answer to 99 out of 100 questions?... Money."

we'll have to recent check insider transaction stock sales when the information is available.

http://finance.yahoo.com/q/it?s=PALM


RE: Guess the OTR Global reports was absolutely correct, eh?
abosco @ 2/26/2010 6:40:10 AM # M Q
Yep. We knew it, they knew it, but Engadget still had to report, "Oh no, everything is FINE!!" because they have sprung a big rubbery one for the Pre.
RE: Guess the OTR Global reports was absolutely correct, eh?
abosco @ 2/28/2010 7:23:11 AM # M Q
I was at a casino last night getting checked in. Security slid my ID through a Handheld with an attachment. It was a Zire 22.

Meanwhile, I still haven't seen a single webOS device in the wild.

Reply to this comment

Asia Pacific

asiayeah @ 2/26/2010 6:57:56 AM # Q
I wish I can support Palm as a user or as a developer. But the fact is they are not releasing any webOS device in Asia Pacific yet! If they want more sales, please come and sell in Asia Pacific!

Now I wish they can survive until they release in Asia Pacific. Fingers crossed.
--
With great power comes great responsiblity.

RE: Asia Pacific
Gekko @ 2/26/2010 7:05:40 AM # Q

they're doing you a favor.

RE: Asia Pacific
LiveFaith @ 2/26/2010 9:41:40 AM # Q
LOL. UR sick Gekko. :-D
Pat Horne
RE: Asia Pacific
e_tellurian @ 2/26/2010 8:39:40 PM # M Q
There are many markets around the world that would love to work with an industry pioneer like Palm. This unique distinction sets Palm apart from all others and can understand Palms enthusiastic outlook for their future.

E-T

RE: Asia Pacific
jmpiera @ 2/28/2010 6:52:15 AM # Q
LiveFaith wrote:
LOL. UR sick Gekko. :-D

+1

Reply to this comment

Just one question

pretastic @ 2/26/2010 7:12:53 PM # Q
WTF are you people with your venom and axes to grind doing on a site devoted to Palm if you hate them so much? You are not doing anyone, including yourselves, any favors. Why not go somewhere you can make a positive impact? Just wondering.
RE: Just one question
e_tellurian @ 2/26/2010 7:29:05 PM # M Q
Good question. Just add your positive and enthusiastic contributions.

E-T

RE: Just one question
ctp89 @ 3/1/2010 10:31:39 AM # Q
Seriously. Some of the comments here seem to be almost gleeful of the possibility that more people will lose their jobs, investors will lose their money, another innovative American company will die and one of the best most competitive products out there will drop from the market.
RE: Just one question
e_tellurian @ 3/1/2010 11:16:55 AM # M Q
Palm is a pioneer that must be worth enough to see the success of this innovative company. We need to keep people employed in industries that have a leadership position in the market place. Let's hope our concern and thoughts can help a pioneer do what they do best encourage innovative interaction.

E-T

RE: Just one question
BaalthazaaR @ 3/1/2010 1:51:51 PM # Q
ctp89 wrote:
Seriously. Some of the comments here seem to be almost gleeful of the possibility that more people will lose their jobs, investors will lose their money, another innovative American company will die and one of the best most competitive products out there will drop from the market.

The comments here are about Palm getting complacent and losing its position as the leader. The whining is about them losing their identity and and them trying to ape that fruity company. It is about the frustration experienced by their loyal customers that they have constantly ignored due to their cavalier attitude and them going from an innovating pioneer to an also ran struggling to survive. Nobody really wants them to disappear, they want them to wake up and give us something useful with proper thought behind it instead of the sub-par OS and hardware that they've been pushing.

While webos is interesting, it doesn't do what I was accustomed to being able to do, and when it does, it is sub par to an ancient OS. Some of the things they tout as features, I consider as drawbacks and will need to find a way to disable before I give them a chance. Personally as things stand, I'd rather dump them altogether and move on, but I still have a sliver of hope that they'll get their act together. If they fold, I might be induced to finally move on. Or I might hope that their former OS makes it onto some decent hardware like Aceeca has been promising. And then there is always Android once it matures and improves.

RE: Just one question
e_tellurian @ 3/1/2010 2:53:54 PM # M Q
It hurts to know those that helped to build Palm are feeling the change in such a drastic fashion. What makes Palm a pioneer are all the good people that have helped to make Palm the brand that inspires innovation. I sincerely hope people are not left behind as Palm changes. Palm needs those people and those people need Palm ... team work.

E-T

RE: Just one question
BaalthazaaR @ 3/1/2010 4:27:08 PM # Q
e_tellurian wrote:
It hurts to know those that helped to build Palm are feeling the change in such a drastic fashion. What makes Palm a pioneer are all the good people that have helped to make Palm the brand that inspires innovation. I sincerely hope people are not left behind as Palm changes. Palm needs those people and those people need Palm ... team work.

E-T


I seriously doubt that most of them are still there at Palm. Some of them would have left over the years when management was clueless. And some of them would have been in the OS group that was spun off.

RE: Just one question
e_tellurian @ 3/1/2010 5:46:20 PM # M Q
Would that spun off group be welcome to work with Palm to help address some of Palms issues? Perhaps some the energy that built Palm is away but not gone. Perhaps all that needs to be done is to encourage those people to come back for a reunion.

E-T

RE: Just one question
ctp89 @ 3/1/2010 6:29:17 PM # Q
BaalthazaaR wrote:
ctp89 wrote:
Seriously. Some of the comments here seem to be almost gleeful of the possibility that more people will lose their jobs, investors will lose their money, another innovative American company will die and one of the best most competitive products out there will drop from the market.


The comments here are about Palm getting complacent and losing its position as the leader. The whining is about them losing their identity and and them trying to ape that fruity company. It is about the frustration experienced by their loyal customers that they have constantly ignored due to their cavalier attitude and them going from an innovating pioneer to an also ran struggling to survive. Nobody really wants them to disappear, they want them to wake up and give us something useful with proper thought behind it instead of the sub-par OS and hardware that they've been pushing.

While webos is interesting, it doesn't do what I was accustomed to being able to do, and when it does, it is sub par to an ancient OS. Some of the things they tout as features, I consider as drawbacks and will need to find a way to disable before I give them a chance. Personally as things stand, I'd rather dump them altogether and move on, but I still have a sliver of hope that they'll get their act together. If they fold, I might be induced to finally move on. Or I might hope that their former OS makes it onto some decent hardware like Aceeca has been promising. And then there is always Android once it matures and improves.

True - Palm got complacent and lost its leadership. It's amazing they've lasted this long having gone through numerous aquisitions and most boneheadedly losing ownership of their own OS. However they've made a huge effort in the last year and compared to the current competition, I believe the Pre is the best smartphone out there. Blackberry - based on an outdated Java OS and reliant on RIM datacenters (which go down now and then). Their devices are huge and geeky. iPhone - expensive, single-carrier, no-multitasking, annoying screen-based keyboard and totally locked down by Apple. Android - no hardware or interface consistency and again locked into a huge corporate ecosystem ("Don't be evil?" no, just be Google). What else - Windows mobile?
All I'm saying is that despite past missteps - Palm now has a great product - small, stylish, open and capable. And WebOS 1.4 is smooth, stable and fast. Palm just needs to step up and get that message out there.

RE: Just one question
e_tellurian @ 3/1/2010 7:12:19 PM # M Q
Palm has earned the pioneer distinction. With all who care about Palms success its hard not to succeed. Having a continued role as an innovative enterprise that helped create an industry that employs many people and inspires innovation with many friends that want Palm to continue their pioneering role. While remembering all those that helped to build good products and constructive innovative interaction.

E-T

RE: Just one question
BaalthazaaR @ 3/2/2010 7:28:03 AM # Q
In the interest of space, I have pared down the quote of your last post
ctp89 wrote:
However they've made a huge effort in the last year and compared to the current competition, I believe the Pre is the best smartphone out there.

You're certainly entitled to your opinion there, but this is not a grade school competition. There is no 'A' for effort. If I saw it meeting my needs, I would buy it.

ctp89 wrote:
Blackberry - based on an outdated Java OS and reliant on RIM datacenters (which go down now and then).

Palms servers haven't been around long enough to have a chance to go down. However, unlike RIM, the Palm phones practically become bricks if they can't communicate with the Palm servers. But we can just wait and see about that one. To make things worse, all your data resides on the Palm server, With RIM, you can have your own server even if the encrypted communication is routed through their infrastructure.

ctp89 wrote:
iPhone - expensive, single-carrier, no-multitasking, annoying screen-based keyboard and totally locked down by Apple.

No argument there... even a free iPhone wouldn't interest me.

ctp89 wrote:
Android - no hardware or interface consistency and again locked into a huge corporate ecosystem ("Don't be evil?" no, just be Google). What else - Windows mobile?

As much as I dislike Macroshaft Winhosed/winblows/windos, I would consider that before Palms infrastructure design. And now for Android. Yeah it has its issues, but it is also rapidly evolving. What you call a lack of consistency, I call variety. There is no one form factor that meets everyone's needs. The same goes for a UI. The varied combination increases the likelihood of finding one that meets my needs.

ctp89 wrote:
All I'm saying is that despite past missteps - Palm now has a great product - small, stylish, open and capable. And WebOS 1.4 is smooth, stable and fast. Palm just needs to step up and get that message out there.

I think the damn thing is too small. I think it needs to be bigger if it is to be more than just a phone. And the slider is not designed right. It should not get that loose after being used for a while.

Anyway that was more than the two cents that I intended to throw in.

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Palm's Major Credibility Problem

Gekko @ 2/27/2010 4:42:11 AM # Q

"If the company knew three weeks ago that Verizon and Sprint were stopping orders, why not just announce it then? Why dribble the news out, and attribute a manufacturing stoppage to the Chinese New Year, which would ultimately not pass the smell test since the work holiday typically only lasts a week and Palm's manufacturing has been suspended for the entire month?"

"Management has a serious credibility issue, I'm told, and this only makes it substantially worse. Another told me that Palm's attempts to throw investors off the scent of an order slowdown by its major customers by connecting a manufacturing stoppage to the Chinese New Year isn't nearly as forthcoming as the company ought to be. (He had more colorful language to share, but that's what he meant.)"

http://www.cnbc.com/id/35607982

RE: Palm's Major Credibility Problem
e_tellurian @ 2/27/2010 1:07:37 PM # M Q
Non issue. They are keeping up with demand and wisely making enough but not too much. No point in over producing keeping up with demand is most important and Palm is doing that with out rushing which assures quality.

E-T

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