Palm sales help 3Com beat the street

3Com's fourth-quarter earnings increased 38 per cent from a year ago, to $87.5 million, helping the networking company inch out Wall Street expectations by a penny a share.

Revenues for the fourth quarter, ended May 28, were $1.4 billion, up from $1.37 billion a year ago, 3Com officials said on Tuesday.

Sales of systems products, including 3Com's popular Palm computer, jumped 17 per cent to $784.7 million, comprising a record 55 per cent of total sales. But 3Com's client access business, including modem sales, decreased 10 per cent from a year ago, to $630.9 million, officials said .

3Com earned 24 cents per share for the quarter, compared with 17 cents per share and $63.6 million a year ago. Excluding adjustments related to 3Com's acquisition of NBX Corp and previously recorded merger and restructuring expenses, pro forma net income for the recent quarter was $88 million, or 24 cents per share, 3Com officials said.

Sales for the full year, meanwhile, were $5.8 billion, compared to $5.4 billion in fiscal 1998. Net income was $403.9 million, or $1.09 per share, compared to $30.2 million, or 8 cents per share last year.

Excluding adjustments related to 3Com's acquisitions of Smartcode Technologies, certain assets of ICS Networking, and NBX, and the merger and restructuring expenses, pro forma net income for fiscal 1999 was $397.7 million, or $1.08 per share. Net income for fiscal 1998 excluding adjustments was $246.1 million, or 67 cents per share.

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