Suffering huge third-quarter loss, the Sunnyvale, California based smartphone manufacturer Palm is hoping something big from its upcoming smartphone Pre and webOS. Palm on Thursday reported a net third-quarter loss of $98 million.

Palm blamed the limping economy and the decline in the sales and earnings of its mobile devices for its third-quarter loss. The company, however, said that it is very optimistic about its Pre smartphone, which according to Palm, will help the company to get back to profitability.

Ed Colligan, Palm president and chief executive officer, said, "We're proceeding through a challenging transitional period, however, our current results shouldn't overshadow the tremendous progress we've made against our strategic goals. We're poised to usher in a new era at Palm."

According to Palm, its revenue dropped to $90.6 million from $312.1 million, little more than the company's March 3 prediction that its revenue will fall between $85 million - $90 million.

In a statement, Palm reported that total of 482,000 units of smartphone devices, worth $77.5 million, were sold during the quarter; the number shows that the sales were 42 percent down from the number of smartphones sold a year ago. Its smartphone revenue was also down 72% to $77.5 million from the same period last year.

Palm is now hoping something big and good from its Pre smartphone. The company is set to release its Pre smartphone in June to compete with Apple's iPhone and Research in Motion's BlackBerry.