Meantime, that collective round of applause you might be hearing is probably coming from clients of Mike Abramsky at RBC Capital who published earlier in the week such rosy expectations surrounding this company that I actually heard snickering from other analysts. Yeah, who's doing the snickering now? Certainly not Credit Suisse which just downgraded shares and took its target down from $18 to $12, or Canaccord Adams which just this morning revised its sales expectations from nearly $400 million down to just shy of $300 million.
Abramsky nailed it, anticipating total sell through of up to 800,000 units and $318 million in non-GAAP revenue.
Abramsky should feel good, but not as good as the folks at Palm who did all the hard work to get these numbers on the books. Last quarter, with only a week of Pre sales available, certainly didn't count when it comes to gauging market penetration. This quarter is absolutely key, offering us a glimpse of the Pre's early adoption. Let's see what happens next quarter, to see if Palm has come up with a way to keep this momentum going.
And in fact, looking at the company's second quarter, there's a strong indication that Palm's momentum runs the risk of slowing, and significantly. The company now anticipates adjusted sales between $240 million and $270 million. The midpoint of $255 million is dramatically lower than the $344.3 million analysts were expecting. That could be a serious problem, and make today's celebration short-lived in Sunnyvale.
Meantime, Apple , Research in Motion and Nokia still reign supreme. But Palm, if it can sustain this kind of blockbuster performance, is no longer the court jester.
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