Dim numbers at Sun Microsystems
Sun Microsystems (JAVA) posted a weaker-than-expected fiscal third quarter Thursday, as the slowing U.S. economy resulted in a year-over-year revenue decline. The Santa Clara, Calif., server company lost $34 million, or 4 cents a share, for the quarter ended March 30, reversing the year-ago profit of $67 million, or 7 cents a share. Revenue dropped 0.5% from a year ago to $3.27 billion. Analysts were looking for an 18-cent profit on sales of $3.38 billion. Shares fell 8% in after-hours trading to $14.95, following a 6% rise Thursday afternoon.
“The U.S. economy presented Sun with significant challenges in the third quarter, masking our progress in developing nations and economies across the world,” said CEO Jonathan Schwartz. He said the company posted “double digit year-over-year growth in India and Brazil, and triple digit year-over-year billings growth in our energy-efficient, Solaris-based Chip Multi-Threading systems.” The company explains that in the latest quarter, its sales did rise in 12 of the 16 areas in which it does business. Still, Schwartz may be going a little far when he claims that “the world is moving to open source innovation, and Sun continues to lead that revolution.”
I still have Sun shares from the .com era at an average cost of $40/share pre-reverse split. What’s the point of selling them now? So I ask for a bit of “crowd wisdom”: Is Sun Microsystems a takeover target? If so, what would a fair value for the stock them? Any guesses?
To Steve… MySQL is free. How does that add revenue for Sun? (and btw, what do YOU call Sun???)
Sun is in a tough spot. Hardware long ago became a commodity. Services is a tough business that requires big investment, diversity and vertical knowledge none of which they built out, and software is either OSS (free+huge services cost) or proprietary (where Sun has never played)
I mean I guess since the OSS community seems to have a primary goal of shutting down the entire tech industry (unless you monetize clicks - which they’ll allow, sell services - which they LOVE, or make hardware - since you cant “open source” that), this is good news for them, but for Sun, the only thing I see in this long term is dumping lots and lots of money into building out enterprise class support for MySQL to compete with DB2, Oracle and SQL Server only to then see penny on the dollar returns since they’ll have to keep the software near free to spur adoption. Couple that with possibly no hardware sales (since most wont buy their expensive gear to run MySQL when commodity gear can do) and very limited services money since they really dont have DBMS consulting credentials and LOTS of others DO with MySQL, and it doesnt look like a winner.
Personally, I dont see a good future for Sun, but if you do, by all means go long! LOL
When Big Blue wants you out, you will be out. Which round will it be?
Sun Microsystems…. Going….Going….soon to be Gone!!
The worst managed Fourtune 200 company in the world.
If you own SUN shares, get rid of them now before they are worthless. This company is run by the most incompetent management team in the business.
Ah, Linux is only 3 years old? You’re an expert, huh? Btw, Sun recently acquired MySQL, which will indeed add revenue for Sun, as you call it. In the RDBMS business, there’s a lot more money to be made than with OSs.
These morons are living in a dreamworld… “the world is moving to open source innovation, and Sun continues to lead that revolution.” –> are you kidding me? The world already moved to open source innovation 3yrs ago - it’s called Linux… and it doesn’t add revenue for Sun…
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I was sort of thinking about applying to work there when I got out of college. I’ve only worked with their hardware (UltraSparc), software (Java and MySQL) and operating system (Solaris) all through college, and sort of fell in love with the way it all worked together. Do you think that’s a bad idea?