SAN FRANCISCO: Mobile phones and handheld devices maker Palm Inc. said its profits surged to $29.9 million for the third quarter ended 3 March up from $4.4 million reported in the corresponding quarter in the previous year, beating market expectations. The company said it sold more Treo cell phones and launched a new device based on Microsoft's Windows operating system.
The company's revenue for the quarter was up 36 per cent to $388.5 million from $285.3 million a year earlier.
Net earnings in the quarter included a partial reversal of a deferred tax asset valuation allowance of about $13 million.
The company said it expected its revenue to go up to $400 million to $405 million in the fourth quarter ending 2 June and adjusted earnings per share of 22 cents to 23 cents.
Its Treo range accounted for more than 70 per cent the quarter's revenue, up from 46 per cent during the third quarter of last year.
The Sunnywale, California-based company said it improved its share in the U.S. smartphone market to 30 per cent from 22 per cent a year ago. It shipped 564,000 Treo smartphones during the quarter and phones sold through cell phone carriers and other distributors doubled to 569,000.
The company has also marketed a model using Windows Mobile operating system, Treo 700, which is the first of four new smartphones to be introduced later this year.
Palm had benefited to some extent as a result of the patent case involving rival, Canadian company Research In Motion, which faced a suit filed by NTC Ltd, alleging its BlackBerry devices had violated patent laws. The company has now settled the suit.
Palm admitted it stood to gain because of the uncertainty over Blackberry but its Treo Windows version is proving to be a popular device.
Palm's shares were up $1.16 at $21.30 in after-hours trade on the Inet network, after closing up 2.4 per cent on Nasdaq.
