Compaq Overtakes Palm in Hand-Held Revenues

Palm Inc. remains the world’s leading supplier of hand-held computers but will lose its top spot in terms of revenue to Compaq Computer Corp. in the second calendar quarter, according to Gartner Dataquest.

In a report to be released today, the market research firm projects Palm will ship about 700,000 units worldwide, earning $130 million to $135 million in hardware-related revenue for its fiscal quarter ended June 1. That’s a dramatic drop from the record $507 million it earned two quarters ago.

Palm will announce fourth-quarter earnings results next week.

By comparison, Houston-based Compaq, whose current quarter ends June 30, is expected to ship up to 500,000 units, resulting in revenue of more than $200 million. Gartner Dataquest did not have historical revenue comparisons for Compaq but said it shipped 250,000 units two quarters ago.

Handspring Inc., which uses the Palm operating system in its hand-held Visors, comes in third, with a projected $62 million in sales and 330,000 units for its fiscal quarter ending June 30.