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Sun Microsystems Reports Loss of Six Cents: SALES GROW 21 PERCENT

Posted on: Monday, 24 April 2006, 21:00 CDT

By Nicole C. Wong, San Jose Mercury News, Calif.

Apr. 24--Sun Microsystems reported a fiscal third-quarter loss of six cents a share, in line with expectations of analysts who have been calling for large-scale layoffs to boost the Santa Clara-based computer maker's operating profit margins.

Revenue rose 21 percent to $3.2 billion for the quarter ending March 26, up from $2.6 billion a year earlier, in part because of acquisitions. Still, Sun posted a net loss of $217 million, or six cents a share, up from a net loss of $28 million, or one cent a share, a year earlier. About a quarter of the latest quarterly loss -- $57 million -- was due to stock-based compensation charges.

Sun, which sells servers, storage products, software and services, has been struggling to achieve consistent profitability since the dot-com bubble burst. Analysts have criticized the company for not swiftly and substantially reducing its workforce after the bust and for taking too long to embrace lower-cost, standard techologies. But they say Chief Executive Scott McNealy has resisted deeply reducing the headcount at the company he co-founded.

"We're growing again," said McNealy said in a press release. "The next step is consistent profitability."

Contact Nicole C. Wong at nwong@mercurynews.com or (408) 920-5730.

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Copyright (c) 2006, San Jose Mercury News, Calif.

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NASDAQ-NMS:SUNW,

Source: San Jose Mercury News

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