Sun Posts $180 Million Loss in Q1

 
 
By eweek  |  Posted 2001-10-18 Print this article Print
 
 
 
 
 
 
 

Sun Microsystems Inc., hard hit by a drop off in sales following the Sept. 11 terrorist attacks, posted a loss of $180 million for the quarter, as revenue plunged 43 percent from a year ago.

Sun Microsystems Inc., hard hit by a drop off in sales following the Sept. 11 terrorist attacks, posted a loss of $180 million for the quarter, as revenue plunged 43 percent from a year ago. Sun chose not to hold a customary call with market analysts following its earnings announcement today, contending it addressed the necessary issues during an Oct. 5 call at which time it warned of a projected shortfall.
In first revealing the loss, executives with the Palo Alto, Calif., company said already weak sales of the companys Unix-based workstations and servers virtually ground to a halt following terrorist attacks in New York and Washington D.C.
In response to falling sales, Sun said earlier this month it initiated new programs to reduce operating costs and announced plans to lay off 3,900 workers, or 9 percent of its workforce, this year. "To help ensure the long-term health of the business, we are resizing some areas of the company where we have over-capacity, including facilities, while still protecting our field sales and service coverage" Scott McNealy, Suns chairman and CEO, said in a statement accompanying the companys earnings report. Excluding one-time charges, Sun lost $158 million, or 5 cents per share for its first fiscal quarter ended Sept. 30, matching Wall Street analysts recently lowered forecasts, according to a consensus survey by Thomson Financial/First Call. Revenue for the quarter totaled $2.86 billion, well below the $5.05 billion it recorded a year ago. The quarterly loss comes one year after Sun posted one of its strongest quarters, earning $510 million or 15 cents per share over the same three-month period in 2000. Suns fortunes shone bright during the late 1990s, when many Internet-based startup businesses bought the companys high-end Unix-servers to handle Web-based transactions. The surge in sales ended when the dot-com bubble burst last year, and the weakening U.S. economy further undermined sales as large corporations reined in their spending as well.
 
 
 
 
 
 
 
 
 
 
 

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