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Palm Revenue Climbs 36%; Income Soars

3/27/2006 09:13:00 AM Eastern

Sunnyvale, Calif. — Boosted by strong shipments of its Treo smartphones, mobile computing company Palm reported a 36 percent jump in revenue during its fiscal third quarter, reaching $388.5 million, up from a year-ago $285.3 million.

Net income soared for the three months, ended Feb. 28, registering nearly a seven-fold increase, to $29.9 million, up from $4.4 million in the same period last year. Excluding one-time items and a tax allowance, the handheld computer maker said it would have earned $19.8 million, compared with $10.6 million in the same quarter a year earlier.

“We delivered strong results this quarter, a result of solid execution against company objectives,” said Ed Colligan, president/CEO. “We extended our record of double-digit year-over-year revenue growth and profitability gains. Smartphone sell-through reported by our carrier partners more than doubled over the year-ago period, validating our strategic decision to support multiple open platforms and offer a choice of smartphones based on either Windows Mobile or Palm OS.”

During the third quarter, Palm shipped a total of 564,000 Treo smartphones, more than double the 279,000 shipped in the same period the previous year.

Treo sell-through reported by the company’s carriers and other smartphone distributors was a record-high 569,000, up 102 percent from the year-ago quarter. This reflected strong demand for the Treo 650 and Treo 700w smartphones, said Palm.

Palm said it grew its share of the U.S. converged smartphone/PDA market to 30 percent during the third quarter, up from 22 percent a year earlier, according to the company’s research source. Its unit shipments grew by 111 percent, compared with the overall market growth of 56 percent, the company’s source said.

Palm said it shipped 510,000 PDAs in the third quarter, down from 659,000 in the same three months the prior year.