SUNNYDALE, Calif.—Palm Inc. reported it sold more than a half-million Treos in its fiscal third-quarter, an increase of more than 100 percent from the same quarter last year. The company said the results reflect demand for its Treo 650 and Treo 700w smart phones—the latter is the first from Palm to use Microsoft Corp.’s Windows Mobile operating system, and is available through Verizon Wireless.
According to Canalys, the British telecom analysis firm, the strong Treo sales grew Palm’s market share of the converged smart-phone/PDA space to 30 percent, up from 22 percent in the year-ago quarter.
Net income for Palm in the quarter totaled $29.9 million on revenues of $388.5 million—a 36-percent increase on revenues for the year-ago quarter.
Palm’s stock was up slightly on the news to $20.44 per share.
The results surprised investment banking firm Lehman Brothers, which said that Treo sell-through and its average selling price (ASP) both were higher than expected. Palm’s ASP rose quarter-to-quarter from $447 to $510; Lehman had projected $460. Lehman attributed the higher ASP to sales of the higher-priced 700w device—likely in the $575 to $600 range, above Lehman’s projection of $525—and ASPs for the 650 model holding up better than expected. Lehman had projected revenues for the quarter at $373 million.
