Bringing the fiscal year to a close, through FY2010 HP netted $126 billion in revenue (up 10% from FY2009) and profits of $14.6 billion (a 15% increase from last fiscal year). That kind of profit comes in handy when you’ve been on a buying spree. Revenue in each of HP’s major divisions was up, with the Palm-containing Personal Systems Group posting a 4% revenue increase. Palm’s contribution to the Personal System Group’s $10.3 billion in revenue was negligible: Palm falls under the 2% “other” slice in the division’s revenue pie (notebooks accounted for 55%, desktops were 38%, and workstations held down the remaining 5%).

For the next quarter, HP is estimating revenue around $33 billion, up from the $31 billion reported for the first quarter of 2010. For the entire 2011 fiscal year, HP is forecasting revenue between $132 billion and $133 billion, a 5% increase over the current year. For those concerned about new CEO Léo Apotheker, he had this to say of his first three weeks at HP: “I’ve been listening, I’ve been learning, I’ve been immersing myself in the business.”

Source:

“Palm is essentially an accelerating death spiral.”

That’s not a good thing to hear, and given yesterday’s bleak financial report, we can’t say we disagree (though we do maintain that it is possible to pull out of a death spiral). That little nugget comes from Ilya Grozovsky, analyst at Morgan Joseph & Co. As CNN Money noted, Grozovsky was one of two analysts to cut their price targets on Palm stock to a heart-stopping $0/share. By valuing the stock at zero, Grozovsky and Peter Misek of Canaccord Adams are declaring that Palm the company is worth nothing.

Those two doomsayers aren’t the only ones kicking Palm to the curb. At this point, not a single analyst will recommend buying Palm stock. Given Palm’s current cash burn rate, most estimate that Palm has only about twelve months to execute a turnaround or find a suitor with deep pockets.

read more

The scrum of analysts trying to get their two cents in before Palm's financial call continues. We won't note all of them, but when something surprising or interesting pops up, we can't help but mention it.

While we hope that the financial results on Thursday will give us a better glimpse into how well the Pre has sold in Europe, the analysts over at MKM Partners aren’t hesitating to say they’ve done well. The firm recently upgraded Palm’s stock from Neutral to Buy and raised their price target to $20 (up from $11). What motivates such optimism in the face of a quarter that is expected to have been as good as predicted but still not that great?

Like us at PreCentral, MKM believes that the expected launch of the Pre and Pixi on Verizon next year will open up Palm and webOS to millions more customers, as well as mitigating “the uncertainty of an AT&T relationship.”

MKM also noted something of particular interest: Palm has performed better in Europe than expected and the Pre has been “outselling key HTC and Motorola [Android] models in major markets like the U.K.” If that is the case, it represents a surprising turn, where Palm historically did well in the US and failed in Europe, but is now struggling in the US and succeeding overseas. Right now we have no way of confirming the hypothesis, though we do hope that Palm at least breaks out their sales by carrier or region.

Thirdly, MKM’s analysts believe that the price battle between Amazon and Wal-Mart over Pre and Pixi pricing is not only indicative of the ongoing war between the two mega-retailers, but that it shows strong support for both devices and vindicates “Palm’s strategy of targeting the mass market, rather than tech enthusiasts.”

And in the last note in their four-point position, MKM actually expects that the soon-to-be-reported quarter from Palm will actually exceed expectations. They also expect that Palm will miss their mark in the coming quarter (ending February 2010), but expansion onto new carriers in 2010 will not trouble investors too much.

While Thursday will bring the answers we’ve been waiting for, it is nice to see that analysts have been more positive on Palm this quarter than last. Then again, they may have learned their lesson when Palm blew out the predicted unit sales by hundreds of thousands. But Palm is still a shaky company in a fast-moving industry in a very shaky global economic climate. Right now, investors are looking for signs that the Pre was not just a one-hit-wonder - they want a company that can survive, or at least one that will make an attractive acquisition target.

Thanks to rowehc for the tip!