Sun CEO sees profit, storage push
Sun CEO sees profit, storage push
By Reuters
February 6, 2002, 4:20 AM PT
Network computer maker Sun Microsystems Chief Executive Scott McNealy on Tuesday stood by a commitment to return to profit by midyear and said Sun was about to announce new storage systems.
"We are not changing our guidance. We are targeting to go profitable again in the June quarter," he told an investment conference hosted by Goldman Sachs in La Quinta, Calif.
Sun gave the same outlook on Jan. 18, when it reported a loss in its fiscal second quarter, ended in December. Its fiscal year ends in June
"The good thing about Sun is we took advantage of the bubble," McNealy said, adding that Sun had built up its brand name and a $6 billion cash stockpile over the last few years. A large part of Sun's customer base evaporated with the dot-com downturn.
But McNealy said he could not predict Sun's gross profit margin, which is revenue minus cost of goods, as a percentage of sales.
"Don't bother asking. I wish I knew. It's really hard," McNealy added.
Sun shares ended Tuesday trading down 25 cents, or 2.4 percent, at $10.15 on the Nasdaq.
Sun, which opens an analyst conference in San Francisco on Wednesday, will introduce a gamut of new data storage products, McNealy said.
The company, known for computers that run corporate networks and the Internet, has been developing a storage strategy for the last couple of years. Last year it struck an alliance with Hitachi Data Systems.
"Tomorrow is the next big broadside to those out there in the storage business who think they can provide better storage for the Sun environment than us," McNealy said.
He said Sun systems based on Hitachi hardware had been winning business usually taken by storage heavyweight EMC.
EMC spokesman Greg Eden said Sun had shifted storage strategies several times. "Sun has opted for the 'promise rather than deliver' approach to storage before," he commented by e-mail.
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