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Handspring's Loss Narrows

The handheld maker, which is likely to merge with Palm this month, misses analysts' estimates on revenue.

Updated from 4:34 p.m. EDT

In what is likely to be its last quarter as an independent company,

Handspring

(HAND)

on Thursday reported that it narrowed its first-quarter loss, but missed Wall Street's revenue target.

For the September quarter, the maker of the popular Treo handheld device lost $13.9 million, or 9 cents a share, compared to a net loss of $15.3 million, or 11 cents a share a year ago, according to generally accepted accounting principles. On a proforma basis, the loss totaled 9 cents a share, which was a penny lower than Wall Street had expected.

Revenue for the first fiscal quarter of 2004 was $13.1 million, down sharply from $54.1 million in the first quarter of 2003. Analysts polled by Thomson First Call had expected sales of $14.33 million.

Handspring's shareholders are expected to approve the company's merger with

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Palm

(PALM)

when they meet on Oct. 28. If so, shares of the new company will be traded on the Nasdaq under the symbol

PLMO

beginning Oct. 29.

Handspring was founded by founders of Palm in 1998 and went public in 2000. The company never turned a profit.

Most recently it has launched a new smartphone, the TREO 600, to good reviews. The new handheld has been shipping to OEMs for a few weeks and is now available in the U.S. on the company's Web site.

The new product had very little effect on the quarter's results, the company said.

Shortly before the close, Handspring was up 6 cents, or 5%, to $1.23. After-hours shares were dropping 5 cents.