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Despite strong sales of its Palm Centro smartphone, Palm reported its 5th straight quarterly loss yesterday. It posted a net loss of nearly $42 million for the three months ending on August 31st, which is a sharp increase when compared to their net loss of $841,000 for the same period last year.

Amid the loss is a success - the Palm Centro smartphone, which sold more than 1 million units in the past quarter, an almost 50% increase from last quarter and has sold more than 2 million units in less than a year. The phone, which is available from Sprint, AT&T, and Verizon, comes in a variety of colors (including the upcoming Rose and Green) and was a hit among women and newcomers to the smartphone world. It also endeared itself to Palm veterans loyal to the aging OS.

“I’m pleased with our momentum as we work to re-establish Palm as the leading innovator in the smartphone marketplace,” said Ed Colligan, Palm’s president and CEO.

With the recent introductions of the Treo 800w and Treo Pro, and with their much anticipated Linux-based update to the Palm OS due in early 2009, Palm may be poised for a triumphant comeback, but first it will have to stick to its promised delivery date for the new OS, named Nova. Palm users have been waiting years for it and many have become frustrated and moved on to other devices. If they finally do deliver the new OS and it’s a hit, they just may see a return to their glory days when they were the top U.S. smartphone maker. As a long time Palm fan who owns and loves her Centro, I am eagerly awaiting the first quarter of 2009!

Read[InformationWeek]