The company shipped 960,000 smart phones to stores and distributors in the quarter that ended Feb. 26, 23 percent more than in the previous quarter. However, the number of phones that were actually bought by consumers was 408,000
The bad news isn’t that Palm only sold 408,000 phones (well, that’s actually horrible news, but nothing compared to what’s next). No, the bad news is that a backlog 552,000 shipped phones is sitting on carriers’ shelves.
Think about it. Though trending downward, let’s imagine Palm has 10% better unit sales in the coming quarter than the one just passed. They’d still have 100,000 phones in inventory without having shipped a single phone in the quarter.