Sun Microsystems reported an 11 per cent drop in revenue for the December quarter but managed to beat the modest expectations of financial analysts.
Revenue for the quarter, the second of Sun’s fiscal year, was US$3.22 billion, down from $3.62 billion in the same quarter a year earlier, Sun announced Tuesday. That was slightly ahead of the consensus analyst estimate of $3.16 billion, according to Thomson Reuters.
The net loss for the quarter was $209 million, or $0.28 per share, which compares to a net profit of $260 million, or $0.31 per share, for its second quarter of fiscal 2008. The loss per share includes $222 million in restructuring charges, related mostly to the mass workforce reductions that Sun announced in November.
Excluding those and other charges, Sun would have reported a profit for the quarter of $114 million, or $0.15 per share, the company said. Analysts had forecast a loss before charges of $0.10 per share, so the profit was an unexpected surprise.
Sun has been battling to grow its revenue for several quarters as customers cut back spending on its high-end Sparc servers in favor of industry-standard x86-type machines. Some of Sun’s largest customers are big financial firms, so it has been hit particularly hard by the turmoil on Wall Street.
The company announced a plan in November to lay off up to 18 per cent of its workforce, or 5,000 to 6,000 employees, as part of a restructuring designed to save it $700 million to $800 million per year. The move followed Sun’s report of a $1.68 billion loss for the September quarter.
Concerns about the economy led customers to delay higher-end system purchases during the last quarter, so sales were down compared to last year for Sparc enterprise servers as well as the software and services normally sold with them, CEO Jonathan Schwartz said during a conference call Tuesday.