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Palm is set to announce their profits tomorrow from their first full quarter selling the Palm Pre, and the results could spell the difference between a comeback and a delayed crash and burn.

Palm stocks are up 23 percent since the release of the Pre in June and there is some buzz started for the Palm Pixi expected to be released by the end of the year. However, most analysts note that Palm has sold about 500,000 Pres in their first quarter, when Apple sold 3.8 million iPhones in the same period. Those numbers are a bit more then Palm was expecting, but are still unlikely to set the world on fire. Of course, the Pre is available in far fewer markets then the iPhone but it seems analysts are edgy, especially considering that the smartphone market is getting more competitive, with Android and Windows Mobile making strong pushes with highly anticipated handsets coming soon and Apple expanding their reach into highly lucrative territories (such as China).

In light of Palm’s improvements in share price (considering how low their stock had fallen, any increase was significant) balanced against the rising competition, most analysts are staying neutral and waiting to see what Palm has to say tomorrow. According to Bloomberg, of the 25 analysts keeping track of Palm stock, only five have “buy” ratings at the moment. Certainly better than six months ago, but there is still a long way to go until Palm is the stock market darling it once was and the smartphone market is not standing still waiting for them.

A ray of sunshine as to Palm sustaining this modest comeback (if it really is one) comes from RBC Dominion Securities Inc. who conducted a survey of Pre customers last month They said that the Pre is “delivering a high level of customer satisfaction and a relatively low level of returns. A lot of the praise for the product goes to the new operating system that Palm has built.” If the success the Pre has enjoyed is due to the OS, then that bodes well for long term success since Palm has already declared they will be loading the WebOS on many devices in the future, and that the Pre and Pixi are just the beginning.

However, if the numbers tomorrow don’t give investors the feeling that Palm is on the right track, then the Pre and Pixi could just be the beginning of the end.

(Source: Globe and Mail)

Zealot (476 Posts) - Website | Twitter | Facebook

By day a department manager and writer for a major network device vendor...by night Zealot stalks the mean magnetic streets, striking fear into the hearts of bandwidth abusers and theme park mascots. Zealot has been involved with mobile devices for more than a decade now, starting off with dumb phones, moving to PDAs and then to smartphones, notebooks and netbooks with the odd PMP thrown in. Most of his mobile time currently is spent on a Treo Pro, Zune HD, Thinkpad T61, Gigabyte M912M or a Hackintoshed Compaq Mini 704. He proudly groks the Geek community and considers himself a Neo Maxi Zune Dweebie (thanks Will Wheaton!).