September 20, 2004 3:31 PM PDT
PalmOne posts profit, exceeds estimates
The Milpitas, Calif.-based company reported first-quarter revenue of $273.1 million for the period ending Aug. 27, compared with $168.6 million a year ago. Earnings reached $19.6 million, or 38 cents per share. That compares with a loss of $16.9 million, or 57 cents per share, last year.
Analysts were expecting revenue of around $268 million and earnings of 20 cents per share, according to Thomson First Call.
Company executives predicted revenue for the second quarter to reach $370 million. They expect year-end revenue to be between $1.27 billion and $1.31 billion, with earnings between $1.45 and $1.60 per share.
Second-quarter revenue guidance was below analysts' estimates. PalmOne shares fluctuated wildly in after-hours trading, initially rising 15 percent, to $42.89, but then plummeting as low as 17.4 percent, to $30.81.
The company generated $31.3 million in cash in the quarter, bringing its cash and cash equivalents to $210 million.
"Excitement is mounting in our category, and we're confident that our innovative products coupled with our excellent distribution through retail and carrier channels will help us maintain and extend our market leadership," Todd Bradley, chief executive officer of PalmOne, said in a statement.
PalmOne shipped about 981,000 handhelds and phones in the quarter--273,000 Treo 600 phones and 708,000 handhelds. The company has shipped about 661,000 total Treo 600 units. The average selling price for handhelds was $183.
Handhelds accounted for about $144.3 million of the company's revenue while Treo 600s made up around $128.8 million.
The company is gearing up for a fall product launch and plans to sign up one more major cellular partner for its Treo line of phones.