Palm earnings hit by Treo delay
Published: 28 Nov 2006 09:50 GMT
Handheld maker Palm said on Monday that a delay in US certification of its latest Treo will cause current quarter sales and profits to fall short of estimates.
In a statement, Palm said it now expects revenue for its second fiscal quarter, ending 1 December, to be in the range of $390m to $395m, as compared with prior estimates of $430m to $450m provided on 21 September. Earnings will also fall short of estimates, Palm said, with per-share earnings expected to be 10 cents to 11 cents, versus prior estimates of between 15 cents and 18 cents.
"Smart-phone sell-through across our existing products is strong," Palm chief executive Ed Colligan said in a statement. "However, our [current quarter's] revenue will be constrained by a delay in certification of a key product." The company said it now expects to start shipping the Treo 750 in the US early next quarter, the company's third fiscal quarter.
Colligan said the "Treo 750v launch in Europe is doing quite well, and we expect international revenue [this quarter] to be strong".
New mobile phones require approval from the Federal Communications Commission (FCC) before they can be sold in the US. Individual mobile operators also have their own certification processes. The Treo 750 appears to have received FCC approval on 8 November, according to the agency's website.
A Palm representative said the delay refers to approval from its initial US operator. Palm did not name the mobile operator in question, although various enthusiast sites have posted pictures of a Cingular-branded Treo 750 and Cingular itself has included the Treo 750 on a rebate form posted on its website.
The 750 was first shown off in September in London, along with mobile operator Vodafone. Palm unveiled another Treo, the lower-end Treo 680, in October. That model is expected to start shipping after 1 December, Palm said last week.
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