Palmtop computer maker Palm Inc. reported revenue of $522.2 million for its second quarter, ended Dec. 1, up 102% from the $258.6 million generated a year ago. Profit for the quarter was $20.3 million, or 4 cents a share, compared with $12.9 million, or 2 cents a share, a year ago.
Palm shipped about 2.1 million handhelds in the quarter, 45% more than the 1.5 million units shipped in the first quarter. This brings the total devices shipped by Palm to nearly 10.9 million.
"The global economy continues its shift to handheld computing," CEO Carl Yankowski says. Sizing up the holiday buying season for Palm, Yankowski says, "Consumers are saying they are buying smaller-ticket items, but the good news is they are still buying." Craig Mathias, an analyst with Farpoint Group, says Palm is reaping the benefits of its large installed base. Most people know next to nothing about personal digital assistants, Mathias says, so they ask palmtop-packing friends what they use before buying.
Despite the strong earnings news, Palm shares dipped in after-hours trading, which didn?t surprise Mathias. "Given the way the market is today, they could still [meet market expectations] and still fall, based on the philosophy that you sell on good news and buy on bad."