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Palm Has Better than Expected Quarter

Palm has reported revenues of $225.8 million for the fourth quarter of fiscal year 2003, up 8 percent from last quarter. Worldwide sales rose 5 per cent compared with the same period last year, as Palm sold over 900,000 handhelds during the period.

Palm reported a net loss of $15m, or 51 cents per share, on revenue of $225.8 million for its fiscal fourth-quarter. In the same quarter the preceding year, Palm reported a net loss of $27.5m, or 95 cents per share. Revenue in the period was $225.8 million, compared with $233.3m last year, better than analysts' expectations of $187 million.

"We end the year with favorable momentum on virtually every key metric of our corporate dashboard," said Eric Benhamou, Palm, Inc. chairman and interim chief executive officer. "We are gratified to see our efforts to reinvigorate product innovation and to re-energize the market rewarded and our unit demand return to positive growth territory. While the economic context continues to be a challenge, we believe our opportunities for growing shareholder value have improved."

Revenue for the full fiscal year 2003 was $871.9 million, down 15.4 percent from the $1.0 billion reported in fiscal year 2002. Non-GAAP net loss for fiscal year 2003, excluding charges was $66.1 million, or $(2.27) per share. Compared with a 2002 fiscal year new loss of $107.1 million, or $(3.74) per share.

Handheld Shipments
Palm shipped approximately 931,000 Palm handhelds during its fourth fiscal quarter, and nearly 4.2 million Palm handhelds during fiscal year 2003. That brings the total number of Palm branded handhelds shipped to-date to more than 22.3 million. Approximately 1.5 million Palm Powered handhelds, including those sold by Palm OS licensees, were shipped in the quarter, and 29.1 million have been shipped to date.

Leading Market Share
According to IDC's study in the United States, Palm Powered handhelds accounted for 77 percent of all pen-based personal digital assistants shipped in 2002. Palm Powered smartphones led the U.S. converged handheld space with a market share of 75 percent in 2002, IDC said.

"Our new spring handhelds reinvigorated demand this quarter, and built on the successful product launch we had last fall," said Todd Bradley, Palm Solutions Group president and chief executive officer. "Continuing tight operational controls also contributed to our performance. With the proposed merger of Handspring into our company, we'll be better able to meet the full range of our customers' needs and quickly enter the smartphone space, a market with high-growth potential."

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Great news!

MV-Jon @ 6/25/2003 12:45:07 PM #
This is the type of news I like to see on a nice summer day. Maybe with some luck, Palm can weather the onslaught from Redmond...


Jon Niola
President/CEO
Media Vortex, Inc.

RE: Great news!
mszeto @ 6/25/2003 1:33:34 PM #

What are you talking about? This is good news, but by no means is it GREAT news. They're still losing money! 15 million in a quarter! Now, this is better than the same quarter last year, but still - how long can they sustain this? Especially at a loss of 51 cents a share!

RE: Great news!
Fammy @ 6/25/2003 1:49:07 PM #
When you lose less, it usually means things are turning around. So it could be great news. Either way, the stock is up a point or so.

_____
Fammy
RE: Great news!
hoodoo @ 6/25/2003 1:49:35 PM #
A quick (very quick) glance at the financial statements indicates they're making progress here, so good news. In light of the poor market, they introduced many new models, driving new sales, while cutting costs and reorganizing. They used more cash than the same quarter last year, but curiously they spent less on R & D than last year's quarter.

If they can continue to draw in Zire buyers then push them up market to more expensive Zires and Tungstens, combined with a general market upswing, then they may even turn a profit and turn cash flow positive. Whoa.

RE: Great news!
a3 @ 6/25/2003 2:45:57 PM #
I'm no stock market expert but I can do some math: Palm has reduced its loss almost by half (27.5->15) notwithstanding the fact that revenue was lower than last year's (233.3->225.8).

Anyway, the most important thing is that they seem to be on track as they've never been in the last few years: The Zire and Tungsten lines are giving Palm an interesting advantage over Sony and PPC. As a matter of fact the 1 million+ Zires sold, proved that a no-backlit, no-cradle, no-color, under-100 PDA was a very good idea, contrary to our predictions in PIC a couple of months ago.

And the best is yet to come?

_______________________________________
Already a Tapwave's Helix fan.

RE: Great news!
hotpaw4 @ 6/25/2003 5:00:59 PM #
someone wrote:
>how long can they sustain this? Especially at a loss of 51 cents a share!

With around $9 cash per share on the balance sheet, they could sustain this for almost 18 quarters, or until 2007. That should give them a bit of time to turn things around into profitability.

But don't forget that they have to merge in Handsprings potential losses and lose out on PalmSource's royalty income starting next year, assuming the deal is completed.

SHIP TT2 NOW!!!!!

Foo Fighter @ 6/25/2003 1:21:36 PM #
Before I turn into the HULK! ;-)

Tired of waiting.


RE: SHIP TT2 NOW!!!!!
frauen1 @ 6/25/2003 2:14:12 PM #
Unnhgh - too late - I can't stop... AUUGH! HULK WILL SMASH!

*KERPOW*!

RE: SHIP TT2 NOW!!!!!
Altema @ 6/25/2003 2:48:40 PM #
I'm with ya Foo, whoever arrives first (T|T1 upgrade, or T|T2) will probably get my money.
RE: SHIP TT2 NOW!!!!!
Foo Fighter @ 6/25/2003 3:07:16 PM #
I still can't believe how badly Sony has disappointed me. Talk about let downs. Holy feces. SJ33 is a waste of good plastic. TG50 is too restriced (appeals only to those wanting a keyboard). NX series? Boring, poorly speced, way too expensive. Palm is my only salvation, it appears. TT2 isn't to the most exciting product, not by a longshot. But it is the only enticing product (for me anyway) that I've seen so far. I would still prefer a flip cover. But considering what is currently available from PalmOS licensees...I'll take what I can get.

RE: SHIP TT2 NOW!!!!!
abosco @ 6/25/2003 3:15:08 PM #
>I still can't believe how badly Sony has
>disappointed me. Talk about let downs. Holy feces.
>SJ33 is a waste of good plastic. TG50 is too
>restriced (appeals only to those wanting a
>keyboard). NX series? Boring, poorly speced, way too
>expensive.

Whoa, first you LIE to me and now you're stealing my words? KIDDING, kidding.

But seriously, I can't even count how many times I've posted my disgust with Sony and Palm's recent lineups. The Tungsten|C's specs should be standard in everything $400+. I don't want to see any more $600 NX's with 16 MB and 200 MHz with a 100 MHz bus. There are $200 Axims with better specs than that for crying out loud. What's Palm and Sony have to offer in the $200 range still? A 33 MHz, 8 MB, 160x160 12 bit color m130? Ohh, Microsoft must be wetting themselves now.

How about we up the ante already? DragonBall should be GONE in $100+ Palms.

-Bosco

RE: SHIP TT2 NOW!!!!!
longtimepalmuser @ 6/25/2003 4:15:51 PM #
I hope they do too, and put the virtual grafitti area on it at last.

Last week I got a 400MHz XScale PocketPC given free to me by Microsoft for upgrading to VisualStudio2003 (not bad for 200!) - Yes they've got to the point where they are giving them away to the masses now! Problem is they will get market hold doing things like this.

Sadly, as I have never been a fan of PPC's and it's cumbersome MS OS, and the dull looking hardware too, But I have to admit to being more tempted to this OS than ever before. I know it's been said before, but Palm need to produce some PPC bashers, before their last chance slips away. - Like the Sony's but without that bloody awful clamshell/keyboard form factor.

Just one other thought... With the PPC and Palm OS's converging on very similar hardware platforms now. i.e. XScale, 64Mb Ram, etc maybe we could see a Palm OS5.2 / 6.0 "upgrade" for PPCs? and just flash the Palm OS over the top of the Microsoft offering. As the saying goes - "If mohamed won't go to the mountain..."

I hope that Palm sees sense, and can maintain it's position.

RE: SHIP TT2 NOW!!!!!
twalk @ 6/25/2003 4:36:12 PM #
Forget the T2, if they'd ship a new treo 90 w/ a hi-res screen, OS 5, and just as long of battery life, I'd buy one immediately.


RE: SHIP TT2 NOW!!!!!
greentruck15 @ 6/25/2003 4:54:09 PM #
The hulk was such a great movie, I was impressed..and palms are cool - go palm yea loosing less money.

ship a Treo 90+ now?
hotpaw4 @ 6/25/2003 5:14:18 PM #
someone wrote:
>ship a new treo 90 w/ a hi-res screen, OS 5, and just as long of battery life

That would be nice if it were possible at a reasonable price. But the Treo 90 has a small battery, and a hires screen uses a lot more battery power. But a Treo 90+ with a standard res display and OS 6 might be nice ...

RE: SHIP TT2 NOW!!!!!
twalk @ 6/25/2003 6:32:15 PM #
"But a Treo 90+ with a standard res display and OS 6 might be nice ..."

Maybe. But it doesn't seem like that would be much of an upgrade to me. Not enough to put out $$$.

I like everything about the 90, except for the screeen...


RE: SHIP TT2 NOW!!!!!
Altema @ 6/25/2003 8:09:23 PM #
How about the Treo 600?

(I feel really funny posting this under the subject of SHIP TT2 NOW!!!!!)

ANYways, was I the first person on PIC to coin the term T|T2?

RE: SHIP TT2 NOW!!!!!
Lucky Bob @ 6/25/2003 9:53:29 PM #
"But seriously, I can't even count how many times I've posted my disgust with Sony and Palm's recent lineups."

Other than the SJ20 and the SJ22, the Sony line is pretty lacking...

"The Tungsten|C's specs should be standard in everything $400+."

Ooo, I'd like that...

"I don't want to see any more $600 NX's with 16 MB and 200 MHz with a 100 MHz bus. There are $200 Axims with better specs than that for crying out loud."

So I'm not the only one...

Is it me, or is Sony starting to lose their pazaz with their N-line?

"What's Palm and Sony have to offer in the $200 range still? A 33 MHz, 8 MB, 160x160 12 bit color m130? Ohh, Microsoft must be wetting themselves now."

The SJ22 is a lot better for the price (ex. 320x320 screen, and 16MB). I like my m130, but I really feel Palm needs to replace it with something better...

(Why do some people say you can kill two birds with one stone when it's hard enough killing one bird with two stones?)

RE: SHIP TT2 NOW!!!!!
rsc1000 @ 6/25/2003 11:17:30 PM #
Seriously! Sony has really surprised me with repeated ball dropping so far this year. The good thing is that - unless they are complete morons (which i am pretty sure they are not) - then we should expect a decent new device this year that meets our wish list.

Barron's just said Palm top management really sucks

Gekko @ 6/25/2003 2:25:01 PM #
They said that the top execs are not delivering what they promised and have abandoned key initiatives. Sorry - I don't have the article to post.

How much longer can Palm burn cash like this?


RE: Barron's just said Palm top management really sucks
hgoldner @ 6/25/2003 2:42:55 PM #
Tell you what, they can give ME the cash. I'll burn it for them.

Okay, well, maybe I won't burn all of it, just a little, but at least I'm virtually certain I can put it to better use.

H.

RE: Barron's just said Palm top management really sucks
Foo Fighter @ 6/25/2003 3:13:46 PM #
I can think of a few things I could do with that money. Like buying an Audi, a new gaming PC from Alienware...or the new PowerMac G5 perhaps.

The money would still be wasted but going to better cause; My gadget addiction.

RE: Barron's just said Palm top management really sucks
Lungboy @ 6/25/2003 3:21:44 PM #
I would buy a new Clie =)

~~~~~~~~~~~~~~~~~~~~~~
Eagles may soar but at least weasles don't get sucked into jet engines.
RE: Barron's just said Palm top management really sucks
abosco @ 6/25/2003 3:31:23 PM #
I would use the money to buy and sell Palm's upper management for use in the South American marijuana fields. Then I would force Palm to flood the market with $50 Zires, $200 Zire 71's, and force them to create a 320x480 transflective Palm and not them leave the lab until they have a beta model up and running.

Oh, and then I would bring in Yankowski to entertain me with his ideas of Palm.net and $450 monochrome models.

-Bosco

RE: Barron's just said Palm top management really sucks
a3 @ 6/25/2003 4:00:09 PM #
Heroin has a better ROI!!!

That way you can give away Zires and Z71 will be at US$100.

By the way when you lock them up at the lab torture them a little for our long months waiting for the tablet 320x480!
______________________________________________________
Just for safety sake: Drugs are illegal in South American countries! (An US friend of mine learned that when he came to Colombia)

RE: Barron's just said Palm top management really sucks
Altema @ 6/25/2003 8:14:32 PM #
"Just for safety sake: Drugs are illegal in South American countries!"

Yeah, wish they were illegal in MY neighborhood!

RE: Barron's just said Palm top management really sucks
Miss Clie @ 6/26/2003 8:37:54 AM #
Run this section through Bullfighter, yeesh:

"We end the year with favorable momentum on virtually every key metric of our corporate dashboard," said Eric Benhamou, Palm, Inc. chairman and interim chief executive officer. "We are gratified to see our efforts to reinvigorate product innovation and to re-energize the market rewarded and our unit demand return to positive growth territory. While the economic context continues to be a challenge, we believe our opportunities for growing shareholder value have improved."

This is the most corportate bull**** bingo I've seen in a while. I always have to wonder how well the company is *really* doing when they have to truck out the lingo to this depth.

RE: Barron's just said Palm top management really sucks
Miss Clie @ 6/26/2003 8:41:55 AM #
"I would use the money to buy and sell Palm's upper management for use in the South American marijuana fields."

You know... this could spell the end of the war on drugs. Imagine if the drug cartels were mismanaged to death...

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