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PalmSource Revenue Climbs 12%

12/23/2004 09:03:00 AM Eastern

Sunnyvale, Calif. — Licensees of PalmSource reported shipping the largest number of Palm Powered smartphones in any reporting quarter during the company’s fiscal second quarter, ended Nov. 30, as the company continued to see a larger portion of its business come from this product category

PalmSource, which provides the Palm OS operating system that powers mobile information devices and smartphones, reported revenue of $19.2 million for the three months, up 14 percent from the $16.8 million recorded in the year-ago period.

The company moved into the black during its second quarter, reporting $2.1 million in net income, compared with a net loss of $9.1 million in the same three months in 2003.

Excluding the effects of stock-based compensation, restructuring charges, separation costs from Palm, and other factors, net income for the second quarter was $3.2 million, compared with a net loss of $0.3 million in the same three months a year earlier.

PalmSource licensees said they shipped about 1.2 million units in the second quarter, of which 30 percent were smartphones, with the remainder being PDAs and other mobile handheld devices. This compares with a total of about 1.3 million units shipped in the second three months of last year, of which 6 percent were smartphones and the remainder PDAs and other mobile handhelds. The decrease in total unit volume vs. the prior year’s quarter was primarily related to Sony’s exit from the PDA market outside of Japan.

For the six months, PalmSource revenue climbed to $37.4 million, up from $34 million year-on-year.

The company reported net income of $1.9 million for the six months, compared with a net loss of $13 million in the same period a year ago. Excluding charges and other factors, six-month net income reached $4 million, compared with a net loss of $1.8 million in the same period in 2003.