Palm’s shares tumbled 20 percent yesterday as the Californian vendor slashed its fiscal third-quarter and full-year revenue target due to slow consumer demand for its products. It expects Q3 revenue of US$300-US$320 million on a non-GAAP basis, well below analyst estimates of US$425 million. Palm will announce its Q3 results on March 18. Fiscal year 2010 revenues are expected to be well below the company’s previously forecasted range of US$1.6-US$1.8 billion. In a statement, Palm noted that “revenues for the quarter and full year are being impacted by slower than expected order volumes from carriers and the deferral of orders to future periods.”

Palm is struggling at present to turn itself around. Last year the vendor announced new smartphones such as the Pre and Pixi, as well as a new webOS platform, which were generally regarded as innovative new products. Despite the initial positive reception to the new devices and OS, sales have been slow. “Palm webOS is recognised as a groundbreaking platform that enables one of the best smartphone experiences available today, and our work to evolve the platform and bring industry-leading technology to market continues. However, driving broad consumer adoption of Palm products is taking longer than we anticipated,” said Jon Rubinstein, chairman and chief executive officer. “Our carrier partners remain committed, and we are working closely with them to increase awareness and drive sales of our differentiated Palm products.” That last reference to committed carrier partners may be a response to reports this week that one of its US partners, Verizon Wireless, is considering dropping its products. Such a scenario seems unlikely though, as the country’s largest operator yesterday issued a press release touting the wide variety of applications available on the Palm Pre Plus (pictured) and Palm Pixi Plus smartphones.