Palm earnings fall, but beat expectations
Published 10:09 pm Friday, September 17, 2010
Smart phone maker Palm Inc. posted a wider loss for its fiscal first quarter on Thursday as revenue dropped, but adjusted earnings and sales handily beat Wall Street’s expectations. For the three months ended Aug. 28, the company posted a loss after paying preferred dividends of $164.5 million, or $1.17 per share, compared with a loss of $41.9 million, or 39 cents per share, in the same period a year earlier. Excluding one-time items, however, the company posted a much smaller loss of $13.6 million, or 10 cents per share, in the latest quarter. Revenue tumbled to $68 million from $366.9 million. But adjusted sales, which exclude deferred revenue and cost of sales from the Pre smart phone, totaled $360.7 million. Analysts, on average, were expecting a loss of 24 cents per share on adjusted sales of $297.7 million.
Banks cut back on borrowing from Fed
Banks reduced their borrowing from the Federal Reserve’s emergency lending facility over the past week, and cut back their use of other programs designed to ease the financial crisis. The reductions indicate that banks are having an easier time obtaining credit and don’t have to rely as much on the Fed for short-term loans. Banks averaged $28.7 billion in daily borrowing over the week ended Wednesday, down from $30.4 billion in the week ended Sept. 9. Banks borrow from the Fed when they have trouble getting the money elsewhere.
IPO activity forges comeback
Coming off its worst year in three decades, the market for initial public offerings is starting to show signs of life. Eight companies are looking to raise as much as $3.7 billion when they go public next week, the most activity the U.S. IPO market has seen in a single week in nearly two years and a clear sign that Wall Street’s appetite for risk is returning. IPOs all but dried up in 2008 as investors shunned the traditionally risky bets and moved into safer assets like cash and Treasuries as the stock market tumbled. Only 43 companies completed IPOs in the U.S. last year, down from 272 in 2007 and 221 in 2006.
Discover Financial triples its profits
Discover Financial Services said Thursday it more than tripled its profit in the fiscal third quarter, helped by a payment from a lawsuit settlement. Even without the gain from the lawsuit settlement, the credit card lender would have been profitable, despite rising defaults and delinquencies and falling card sales volume. Nearly all lenders are seeing more customers stop making their monthly payments as the economy falters and unemployment rises. Discover said its earnings available to common shareholders surged to $559.4 million, or $1.07 per share, during the three months ended Aug. 31. That’s up from $180.1 million, or 37 cents per share, a year earlier. The company’s results were bolstered by a $472 million payment from an antitrust lawsuit with Visa Inc. and MasterCard Inc.
From Herald news services
