S&P: Palm on watch

Standard & Poor's said it placed its B corporate credit rating and other ratings on Palm Inc. on CreditWatch with negative implications.

The action reflects the company's declining revenues and profitability levels, which have fallen significantly below earlier expectations, the agency said, adding that the company reported negative EBITDA for the November and February quarters, in part because of a market shift towards its lower-priced products.

Still, cash balances, $272 million at Feb. 28, 2008, remain adequate for near to intermediate term operations, the agency added.

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