Originally Posted by s219:
Palm is like Apple in the sense that they don't sit on inventory and they can tailor production on a short term basis; in both cases, you can expect the difference between sell-in and sell-through to be small. That's just a reality of the system, independent of overall or long-term supply-demand numbers.
We just can't conclude anything (pro or against your theory) with overall numbers. I think the best we can say is that supply is not outpacing demand by a whole lot when spread over the quarter. It doesn't really tell us if the Pre was languishing on shelves, day to day, during the middle of the quarter, or not.
I will say this, if they were having trouble keeping up with demand, we surely would have heard about it during the conference call. While it's not a 100% bragging point (since it may indicate they didn't plan properly or setup sufficient production), companies almost always trumpet when they are having trouble keeping up with demand.
I think if you look at the lack of specific numbers and milestone press releases, the price cuts, and the fact that Palm acknowledged that they had demand from the Sprint and Bell launches but lower sales inbetween (which forms the basis of their lowered guidance for the current quarter), it suggests the device wasn't selling as well as they had hoped. I think you'd have to be a real optimist to see it the other way around.
I don't think I'm being overly optimistic. I think that without easy answers (give me exact Pre sales numbers or nothing), analysts and other people such as yourself remain doubtful as it is the path of least resistance and effort. Considering the very, very tight supply constraints that plagued the entire first month of the launch which they knew would exist, so much so in advance, that Sprint didn't even majorly launch their ad campaign, I find it unreasonable to assume that at any point in the quarter that Pres "languished on store shelves" with the added backup to my reasoning being the sell-in/sell-through difference and the final sales numbers.
Regarding the rest of your post, please refer back to the original post and my second post on the subject. Goldman references the price cut (gain faster traction in adoption over preserving margins) as a leg up on new on-coming competition that is all hitting at the same time during the holiday season. The pre-holiday season would be another reason for somewhat more limited demand during Q2. The summer contained back-to-school sales on top of the launch. Palm's Q2 (Sept.-Nov.) unlike most others Q2 (I can't help but think that most don't take this into consideration as it doesn't include the Santa factor) is without any notable shopping event/holidays.
You sound clearly intelligent and knowledgeable enough to also agree that NDA's between Sprint and Palm would be, not only, a reasonable explanation for a non-breakout of numbers, but given Sprint's situation, quite likely. I would like to hear more from you regarding that particular post to flesh out your entire hypothesis as I think I've laid out quite a few examples of known and demonstrated behaviors on the part of all carriers that support my reasoning.