Palm’s 4th-Quarter Loss Is Less Than Expected

Palm Inc. reported a loss for the fiscal fourth-quarter because of slowing demand and discounted prices for its hand-held computers, but the results were better than the company’s latest forecast.

Palm’s operating loss totaled $89.2 million, or 16 cents a share, contrasted with profit of $17.2 million, or 3 cents, in the year-earlier period. Analysts’ latest consensus estimate was for a loss of 19 cents, according to Thomson Financial/First Call. That expectation reflected sharply lowered forecasts after the company had previously guided estimates downward.

Sales fell 53% to $165.3 million, partly because the introduction of the new m500 device was delayed by a defect, but exceeded the company’s revised guidance of $140 million to $160 million set May 17.

Chief Financial Officer Judy Bruner said the company expects to report a profit in the second quarter, with sales well above analyst expectations. First-quarter sales will come in slightly lower than analyst forecasts, she said.

Palm shares rose as high as $6.12 in extended trading after closing off 4 cents at $5.19 on Nasdaq.