PALM Inc, the smart-phone maker losing sales to BlackBerry and iPhone, will close seven of eight of its retail stores in the United States next month.

Palm also will shut 26 Airport Wireless stores before the end of its fiscal third quarter, the company said. The store at Palm's Sunnyvale offices in California will remain open, according to Bloomberg News.

Palm customers, alienated by a lack of new product designs, have fled to Research In Motion Ltd, maker of the BlackBerry device. Apple Inc also is stealing buyers with its iPhone, which launched in June. Palm had said a shortage of parts would hurt production of its latest Treo smart phone.

"We continue to focus our company around core business initiatives and are consolidating more resources behind fewer programs in order to compete most effectively," Palm said.

The company in December forecast sales that missed analysts' estimates. Sales this quarter will fall to between US$310 million and US$320 million, the second straight decline, the company said.