Sun Microsystems has reported a 1% increase in revenues for Q1 2008. The company’s total sales for the quarter ending September 30, 2007 were $3.2 billion, compared with $3.2 billion for the prior year period. Sun also posted a net profit of $89m, against a net loss of $56m last year.
Gross margin for the quarter was $1.6 billion, an increase of 12.5% compared to last year. The company attributed the growth to stronger sales and improved cost controls.
Diluted net income per share was $0.03, compared with the loss per share of $0.02 in Q1 2007. The company reported that the net income for the first quarter of fiscal 2008 includes a $113m restructuring charge, which equates to $0.03 per share.
Cash generated from operations was $574m, compared with $123m for the prior year period.
The company expected a gross profit margin in the 2008 fiscal year of 44% to 47%, an increase of 1% point over the company’s previous forecast. Revenue growth will most likely be the single digit percentage range for the fiscal year, which began October 1, said Michael Lehman, chief financial officer at Sun.
Sun’s product revenue increased to $1.98 billion from $1.96 billion, while services revenue increased to $1.24 billion from $1.23 billion. The US accounted for 41% of the company’s total revenues, followed by EMEA with 36%.
Sun has cut about 4,000 jobs through layoffs since June 2006 and announced another round of job cuts in August. However, it has not specified the number of jobs that it plans to cut in the latest restructuring.
The revenues growth was a result of the increase in demand for Sun’s server business and software subscriptions. The company has also reported increased adoption of Solaris.
Sun competitor IBM reported revenues of $24.1 billion, a year-on-year increase of 7% for the third quarter ended September 2007. Net income from continuing operations was $2.4 billion, a growth of 6% compared with $2.2 billion the previous year. It reported diluted earnings of $1.68 per share from continuing operations, compared with diluted earnings of $1.45 per the previous year.
Source: ComputerWire daily updates