7/20...SUNW Strong Server Sales Help Sun Top Estimates
Jul 20, 2000 (Tech Web - CMP via COMTEX) -- Sun Microsystems handily beat
analysts' forecasts Thursday with fourth-quarter profits driven by strong sales
of servers used to power the Internet.
The Palo Alto, Calif., company reported that profit for the quarter ending June
30 climbed 67 percent to $659 million, or 39 cents per share, from $395.3
million, or 24 cents, in year-ago period. Sales rose 42 percent to $5.02 billion
from $3.54 billion in the same quarter last year.
Sun (stock: SUNW) sailed pass analysts' earning estimates, which averaged 33
cents, according to First Call/Thomson Financial. The results excluded gains on
the sale of investments and acquisition-related costs.
CFO Michael Lehman said Sun set records for quarterly and annual shipments
across all its computer products, including workstations and the flagship
Enterprise 1000 Server. Sun also topped $5 billion mark in sales for the first
time.
CEO Scott McNealy told analysts during a teleconference that Sun's largest
Internet market has come from ASPs buying hardware to provide online enterprise
services and from large bricks-and-mortar companies, extending their businesses
to the Web through e-commerce sites.
Despite the strong server sales, McNealy said customers have demanded both
software and hardware for building websites. Although Sun does not separate
software figures, the company claims to have a multibillion-dollar business in
Java-related products and applications sold under iPlanet.
"It isn't a product play," McNealy said. "It's a systematic and end-to-end
solutions capability and focus."
McNealy said he expects the Internet to drive Sun's growth, pointing out that
less than 20 percent of U.S. companies have moved to the Web and even fewer
companies outside the United States.
"We're just in the early days," McNealy said, noting that demand will increase
as more companies leverage Web technology for B-To-B transactions and as more
entertainment programming is delivered over the Internet.
Sun's 42-percent sales growth far outpaced rival IBM (stock: IBM), which on
Wednesday reported a 1-percent decline in sales for its second quarter.
techweb.com
Copyright (C) 2000 CMP Media Inc.
-0-
*** end of story *** |
