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Sun Microsystems Reports Second Quarter Fiscal Year 2008 Results
Improved Margins and Bookings Growth Signal Strength in Customer Demand
Revenues for the second quarter of fiscal 2008 were $3.615 billion, an increase of approximately 1.4 percent as compared with $3.566 billion for the second quarter of fiscal 2007. Total gross margin as a percent of revenues was 48.5, an increase of 3.5 percentage points, as compared with the second quarter of fiscal 2007.
Net income for the second quarter of fiscal 2008 on a GAAP basis was $260 million, or $0.31 per share(1), as compared with a net income of $133 million, or $0.15 per share, for the second quarter of fiscal 2007. GAAP net income for the second quarter of fiscal 2008 included a $32 million restructuring charge.
Cash generated from operations for the second quarter of fiscal 2008 was $336 million, and the cash and marketable debt securities balance at the end of the quarter was $4.677 billion.
"Today's results clearly demonstrate steady progress against our financial targets and highlight the accelerating demand set to fuel growth in the back half of the fiscal year," said Jonathan Schwartz, CEO of Sun Microsystems. "Headlining the results were improved margins and strong bookings along with double digit growth in emerging markets including India, China, Latin America, Eastern Europe, the Middle East and Africa. Adding to the momentum were the Solaris Operating System OEM agreement with Dell and our introduction of the industry's first open source datacenter virtualization and management platform, Sun xVM."
Sun has scheduled a conference call today to discuss its financial results for the second quarter fiscal year 2008 at 1:30 p.m. (PT), which is being broadcast live at www.sun.com/investors.
Sun's Annual Analyst Summit (SAS) will be held February 4-6 in San Francisco, Calif. Financial analysts and portfolio managers who wish to attend in person are invited to register at www.cplan.com/sunanalyst2008. The general public is invited to attend online at www.sun.com/investors.
This press release contains forward-looking statements regarding the future results and performance of Sun Microsystems, Inc., including statements regarding demand and expectations for growth in the second half of the fiscal year. These forward-looking statements involve risks and uncertainties and actual results could differ materially from those predicted in any such forward-looking statements. Factors that could cause Sun's actual results to differ materially from those contained in such forward-looking statements include: risks associated with developing, designing, manufacturing and distributing new products; lack of success in technological advancements; pricing pressures; lack of customer acceptance and implementation of new products and technologies; the possibility of errors or defects in new products; a material acquisition, restructuring or other event that results in significant charges; competition; adverse business conditions; failure to retain key employees; the cancellation or delay of projects; Sun's reliance on single-source suppliers; risks associated with Sun's ability to purchase a sufficient amount of components to meet demand; inventory risks; risks associated with Sun's international customers and operations; delays in product development; Sun's dependence on significant customers and specific industries; and Sun's dependence on channel partners. Please also refer to Sun's periodic reports that are filed from time to time with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the fiscal year ended June 30, 2007 and its Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2007. Sun assumes no obligation to, and does not currently intend to, update these forward-looking statements.
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