palmOne Shares Jump on Treo 600 Demand
palmOne's stock today was upgraded by an analyst from J.P. Morgan based on strong demand for the Treo 600 Smartphone. Also, recent comments from palmOne execs at an analyst conference hint at a future line of Treo devices. The company also provided some reasoning behind the delay with Verizon.
J.P. Morgan raised thier rating up to neutral citing strong demand and increased carrier interest in the Treo 600 they also said, "We also believe the company is steadily ramping production, resolving display-related supply constraints." According to various sources, the display has been the main supply bottleneck and has kept palmOne from keeping up with the strong demand for the Treo 600. The stock rose over 12% today on the news to close at 12.70.
Treo line in the Future
palmOne recently presented at the Morgan Stanley Semiconductor and Systems Conference. At the conference CEO Todd Bradley commented that the company will eventually have a whole line of Treo smartphones, ranging from "good, better and best", but declined to indicate any sort of timeframe for such an announcement. He indicated that such future devices would combines different feature sets and options to suit different markets. In other news, Bradley said over 1000 companies are currently undergoing trails with the Treo 600.
When asked about current demand for the CFO Judy Bruner commented that production and supply improvements for the Treo 600 are getting better each day, but the current demand is still outpacing the rate at which the company can produce the smartphones. She went on to say that in the next quarter that smartphone sales could account for as much as a quarter or third of the companies revenue.
Treo 600 and Verizon
palmOne also acknowledged that the Treo 600 is currently undergoing the standard testing and approval trials within Verizon. They remarked that the company has one of the most arduous handset approval processes, which accounts primarily for the delay in the rollout. Each mobile carrier has a testing phase where they test and fine tune handsets and software that will run on their networks before can qualify the device. Mrs Bruner, even commented that Verizon is more of a "follower rather than a leader" when it comes to deploying new handsets.
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