Handheld device maker Handspring has reported a loss of $23.7m during the first three months of the year.

The company blamed the slump on ongoing weak demand for its pocket-sized computers.

Revenues at the California-based company were more than half the amount during the same period a year earlier.

Handspring is banking on its new product, Treo - which combines a phone and a personal digital assistant - to compete more successfully with its archrival, Palm.

Slow take-up

But the company also warned that its previous outlook had been over ambitious.

The company revised down its estimates for sales during the April-June quarter.

Handspring said it had already shipped 47,000 units of its new Treo device, but admitted that actual sales to customers were smaller than hoped.

The downward revision disappointed analysts and investors.

Shares in the firm had risen 11% ahead of the results, but were tumbling fast in after-hours trading.

The stock has fallen more than 50% since early January.