Sun to Reduce Work Force, Again

Sun says it will slash jobs, yet again, before the end of the year in an effort to return to profitability.

Sun Microsystems will spend up to $150 million in the remainder of the year in severance pay, the Santa Clara based maker of servers and storage gear said in a SEC regulatory filing Aug. 7.

Though Suns filing did not specify the number of cuts, some analysts estimate the slash-count at over 1,000. The company expects to absorb most of the charges in the first half of the fiscal year ending June 30, 2008.

On July 30, Sun reported a return to profit in the second and third quarters after five consecutive quarterly losses.

By revamping its product line—selling servers powered by AMD and Intel chips—it is hoping to stage a recovery.

Shortly after current CEO Jonathan Schwartz took over after co-founder Scott McNealys departure as chief executive one year ago, Sun cut approximately 5,000 workers through layoffs and attrition in the United States, Canada, Europe and Asia as part of an ongoing plan to improve profits. 950 of these jobs were slated to be in the U.S.


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