Sun posts $2 billion loss, slight profit

Zardon · Jan 17, 2003, 12:03 AM

SANTA CLARA, CALIF. (Reuters) - Sun Microsystems Inc. on Thursday reported its largest net loss ever, taking more than $2 billion in charges chiefly for investment losses, but managed to squeeze out a small operating profit in a tough environment for selling high-end computers.

Santa Clara, California-based Sun, which makes computers that manage networks, reported a net loss of $2.28 billion, or 72 cents a share, in its fiscal second quarter ended December, versus a year-ago net loss of $431 million, or 13 cents a share.

Revenue was $2.92 billion after $3.11 billion in the year-ago quarter.

Excluding one-time items, Sun reported a profit of $10 million, or nil cents a share. Analysts polled by Wall Street tracking firm Thomson First Call had forecast Sun would post a loss of 1 cent to 3 cents with the consensus at a loss of 2 cents on revenue of $2.91 billion.

The one-time items included a $2.1 billion non-cash charge for write-offs, $357 million in expenses related to job cuts and restructuring costs and $204 million in tax benefits.

Sun said in a statement it had improved its gross profit margin, a reflection of unit pricing which is closely watched by investors, by 2.1 percentage points from the previous quarter.

Shares of Sun, which rode the Internet wave by supplying computers to dot-coms in boom years and then suffered in the bust, fell 75 percent last year, more than double the 36 percent fall of bigger and more diversified rival IBM.

Both have shown double-digit improvement so far this year.

Sun shares closed down 4.39 percent, or 17 cents, to $3.70 on Nasdaq before the results were announced, and were steady in after hours trade on Instinet.

Investors have been concerned about Sun's ability to defend its high-technology territory from incursions by makers of smaller machines running on Intel Corp. microchips. Price competition has also been brutal in high-end computers.

The gross profit margin rose to 43.3 percent from 41.2 percent in the fiscal first quarter.

Jan 17, 2003, 12:03 AM	#1
Zardon DriverHeaven Founder Join Date: May 2002 Posts: 32,480 Rep Power: 177	Sun posts $2 billion loss, slight profit SANTA CLARA, CALIF. (Reuters) - Sun Microsystems Inc. on Thursday reported its largest net loss ever, taking more than $2 billion in charges chiefly for investment losses, but managed to squeeze out a small operating profit in a tough environment for selling high-end computers. Santa Clara, California-based Sun, which makes computers that manage networks, reported a net loss of $2.28 billion, or 72 cents a share, in its fiscal second quarter ended December, versus a year-ago net loss of $431 million, or 13 cents a share. Revenue was $2.92 billion after $3.11 billion in the year-ago quarter. Excluding one-time items, Sun reported a profit of $10 million, or nil cents a share. Analysts polled by Wall Street tracking firm Thomson First Call had forecast Sun would post a loss of 1 cent to 3 cents with the consensus at a loss of 2 cents on revenue of $2.91 billion. The one-time items included a $2.1 billion non-cash charge for write-offs, $357 million in expenses related to job cuts and restructuring costs and $204 million in tax benefits. Sun said in a statement it had improved its gross profit margin, a reflection of unit pricing which is closely watched by investors, by 2.1 percentage points from the previous quarter. Shares of Sun, which rode the Internet wave by supplying computers to dot-coms in boom years and then suffered in the bust, fell 75 percent last year, more than double the 36 percent fall of bigger and more diversified rival IBM. Both have shown double-digit improvement so far this year. Sun shares closed down 4.39 percent, or 17 cents, to $3.70 on Nasdaq before the results were announced, and were steady in after hours trade on Instinet. Investors have been concerned about Sun's ability to defend its high-technology territory from incursions by makers of smaller machines running on Intel Corp. microchips. Price competition has also been brutal in high-end computers. The gross profit margin rose to 43.3 percent from 41.2 percent in the fiscal first quarter.