PalmOne shares gain on profit increase

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Shares in palmOne inched higher on Thursday after the handheld computer maker said its fiscal fourth-quarter profit surged 33 per cent on strong sales of its Treo mobile Phones.

The US group, which plans to revert to the name Palm next month, also said it expected first-quarter profit and revenue to be above analysts’ Wall Street estimates.

During the quarter ended May 31, sales of palmOne’s pocket-sized Treo, which combines a mobile phone with a handheld computer, more than doubled to $182.6m. The company said it expected demand for Treos would continue to be strong in the first quarter, but that would be partially offset by slowing seasonal demand for the group’s handheld business.

For the most recent quarter, the company said net income was $17.7m, or 35 cents per share, compared with $13.3m, or 27 cents, per, in the same period last year. Not including special items, the group recorded a profit of 37 cents per share, surpassing analysts’ expectations of 31 cents. per share. Sales were $335.8m, compared with $267.4m.

Looking ahead, palmOne said it expected to post pro forma earnings of 30-35 cents per share on revenue of $330m-$335m. Analysts had forecast a pro forma profit of 31 cents on sales of $314.1m.

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