Palm announces further job losses

Palm, the leading maker of handheld computers, has said that it plans to lay off more workers.

Two weeks ago shares in Palm fell to all-time lows after it slashed its revenue outlook for the fourth quarter and said it was cutting 300 jobs, 15% of its workforce.

Palm has not said how many more cuts will be made, but it plans to provide further details when it announces its fourth quarter results next week.

"Palm... will make additional reductions in its work force in the first fiscal quarter of 2002 to bring its cost structure closer in line with business conditions," the company said in a statement.

The news sent the company's share price up nearly 10% to $6.19 on the Nasdaq tech index.

New hire

The company has also hired Todd Bradley, the former executive vice president of global operations at computer maker Gateway.

Mr Bradley will become chief operating officer of Palm's main division, which oversees the sale of its handheld computers.

The division, called the Solutions Group, accounts for 97% of the company's revenue.

Shock loss

On May 17, Palm announced that it was expecting a fourth-quarter operating loss of between $170m and $190m, double its prior estimate.

Palm said it had been hurt by a delay in the launch of its new top-end m500 and m505 models and a build-up in stocks of older, cheaper models.

The company began to feel the effects of the US economic slowdown last autumn when the personal computer market began to stall.

Some observers have speculated that Palm might run out of cash by November.