PalmOne shares drop on Q2 results & Q3 forecast

Colin Dunstan · 12-17-2004, 02:34 AM

PalmOne shares plunged yesterday 15 percent to $36.35 in after-hours trading after it reported fiscal second quarter results that disappointed investors and said third-quarter sales and profit would be below analyst estimates.

PalmOne CEO Todd Bradley told analysts on a conference call (archived copy, WMA format) that a decline in revenue from the second to third fiscal quarter, and a lift in the fourth, was due to "typical handheld seasonality" and timing of the rollout of the Treo 650. Overall, Bradley sounded optimistic: "Our strategy is working, and this quarter's excellent growth in revenue and a more than tenfold increase in operating income from the year-ago quarter demonstrate we executed well. Our fall products raised the bar for competitors and earned widespread acclaim. And we grew our handheld-computer market share domestically and abroad."

PalmOne's share price more than doubled between mid-June and mid-December as investors bet that its new Treo 650 product would drive rapid sales growth.

Investors are now disappointed that Palm's third-quarter sales - which will include the important holiday shopping season and were expected to rise 31 percent versus a year ago - won't grow enough to justify the recent run-up in its shares.

Read the official report at palmOne (PDF).

TadW · 12-17-2004, 10:11 AM

That is interesting. Yes, I saw the sharp price drop today. But if you skim the news, you see more or less positive headlines such as this one: PalmOne Q2 sales soar.

Are investors and news journalists two different kind of people?

12-17-2004, 02:34 AM	#1
Colin Dunstan Is papyrophobic! Posts: 1,926 Karma: 1009999 Join Date: Aug 2003 Location: USA Device: Dell Axim	PalmOne shares drop on Q2 results & Q3 forecast PalmOne shares plunged yesterday 15 percent to $36.35 in after-hours trading after it reported fiscal second quarter results that disappointed investors and said third-quarter sales and profit would be below analyst estimates. PalmOne CEO Todd Bradley told analysts on a conference call (archived copy, WMA format) that a decline in revenue from the second to third fiscal quarter, and a lift in the fourth, was due to "typical handheld seasonality" and timing of the rollout of the Treo 650. Overall, Bradley sounded optimistic: "Our strategy is working, and this quarter's excellent growth in revenue and a more than tenfold increase in operating income from the year-ago quarter demonstrate we executed well. Our fall products raised the bar for competitors and earned widespread acclaim. And we grew our handheld-computer market share domestically and abroad." PalmOne's share price more than doubled between mid-June and mid-December as investors bet that its new Treo 650 product would drive rapid sales growth. Investors are now disappointed that Palm's third-quarter sales - which will include the important holiday shopping season and were expected to rise 31 percent versus a year ago - won't grow enough to justify the recent run-up in its shares. Read the official report at palmOne (PDF).

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12-17-2004, 10:11 AM	#2
TadW Uebermensch Posts: 2,583 Karma: 1094606 Join Date: Jul 2003 Location: Italy Device: Kindle	That is interesting. Yes, I saw the sharp price drop today. But if you skim the news, you see more or less positive headlines such as this one: PalmOne Q2 sales soar. Are investors and news journalists two different kind of people?

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