Palm Reports Record Revenue
Palm, Inc. just reported record revenue of $522.2 million in its second quarter, up 102% from the $258.6 million generated in the second quarter of last year. Net income for the quarter was $20.3 million, or 4 cents per share, as predicted by most analysts.
Palm shipped more than 2.1 million handhelds in the second quarter of its fiscal 2001, an increase of 45% over the previous quarter. The number of handhelds shipped by Palm to date totals nearly 10.9 million.
Palm has now had four quarters in a row that revenue grown has been more than 100%. Palm's CEO Carl Yankowski, said, "Strong overall demand in the United States and the international markets for Palm branded handheld products, add-ons, accessories and services together with solid supply chain management enabled us to reach a $2 billion a year sales run-rate during our first year as an independent public company."
Net income for the first six months of fiscal 2001 was $37.5 million, or 7 cents per share, a noticeable increase over the $22.5 million, or 4 cents per share for the first six months of fiscal 2000.
As part of continuing its proof that very little that happens on the stock market makes any sense, Palm's stock lost $5.50 today, a 12.61% loss, down to $38.12.
"I don't think it's Palm specific,'' said Sanford Bernstein and Co. analyst Paul Sagawa of investors' negative reaction. "I think it's much more indicative of the general sentiment of high-valued stocks and the general downdraft on tech issues on the Nasdaq.''
An interesting question, and one that we still don't have the answer to, is exactly how Palm earned this revenue. To predict the future health of the company, many analysts are looking to see whether Palm is actually making any money by licencing its OS. Until now, Palm has made 99% of it revenue from hardware sales but the company predicts that in the future licencing and Palm.Net will be a larger part of their bottom line.
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