Elevation Partners, the private equity firm that bought a 27 percent ($325 million) stake in Palm last fall, remains "very pleased" with its investment. This in spite of Palm's most recent round of layoffs announced this week, and the doom and gloom that's surrounded the company for some time now.

The deal with Elevation Partners not only brought an influx of cash to Palm but new and experienced blood—in the form of Apple's former iPod head Jonathan Rubinstein as executive chairman and a pair of board members, Elevation co-founders and managing directors Fred Anderson (a former Apple CFO ) and Roger McName— as well.

By closing the deal with Elevation, Palm hoped to capture some of the magic Rubinstein and Anderson helped conjure at Apple, leading it to become a top-tier mobile device vendor once again. Once the smartphone and handheld leader, Palm is now falling further and further behind the likes of Apple, RIM, Nokia and HTC.

According to a statement released in the wake of this week's layoffs, the private equity firm says it remains optimistic about its invenstement:

Elevation Partners is very pleased with the progress Ed Colligan, Jon Rubinstein and the entire Palm team are making. The Company's product pipeline, including a next generation operating system due out soon and a new device targeted for the first half of 2009, excite us enormously. Elevation supports Palm in taking the difficult but necessary steps required to migrate from legacy products. We have a very long-term investment horizon and have no plans to exit our investment in Palm.

Sure, Palm's had an actual hit its hands over the last year or so, the entry-level Centro model and a handsome new Windows Mobile smartphone, the Treo Pro. But these successes have not been enough to prop up Palm's sagging fortunes.

For instance, the Centro is aging and the Treo Pro can only be had for full price, as no mobile operator - as of yet - has picked it up. As a result, its high list price has not been subsidized to make it more affordable.

Meanwhile, the company's Linux-based follow up to the aging Palm OS has been delayed a number of times. Time will tell if it is too late, even if new devices and the platform arrive during the first half of next year as planned.