Palm (PALM) provided Q3 revenue guidance of $300M-$320M, versus analysts’ consensus estimate of $426.69M. The company added that it believes its FY10 revenue would be significantly below its previous guidance of $1.6B-$1.8B.  Palm explained that its revenues are being negatively impacted by slower than expected consumer purchases of its products.  "Driving broad consumer adoption of Palm products is taking longer than we anticipated," said Palm CEO Jon Rubinstein.

Several research firms downgraded Palm this week on concerns that sales of the company’s products have been weak.  On Tuesday Bank of America downgraded Palm to Underperform from Buy while lowering its target to $10 from $20.  Also on Tuesday, Macquarie dropped Palm to Neutral from Outperform.  This morning before Palm issued its negative preannouncement, a Morgan Stanley analyst downgraded Palm to Equal Weight from Overweight.  In mid-morning trading, Palm plunged $95c, or 11.62%, to $7.13.