October 05, 2001, 9:37 AM — Citing a global economic downturn and the negative effects of the Sept. 11 terrorists attacks on the U.S., Sun Microsystems Inc. announced Friday that its first-quarter earnings would come in lower than expected, and that it is slashing its workforce by 9 percent.
Sun predicted that it would report revenue of between US$2.7 billion and $2.9 billion for the quarter ended Sept. 30. The company had already said at a mid-quarter conference call that it did not expect to reach the $3.7 billion revenue target it had set earlier.
In the preliminary results released Friday, the company said that it expects earnings per diluted common share on an operational basis to come in at a loss of between $0.05 and $0.07. A Thompson Financial/First Call survey of analysts predicted an earnings per share loss of $0.04 for the quarter.
The company said that it is introducing a program to reduce its workforce by approximately 9 percent, as well as consolidate excess facilities. Due to these reductions, Sun will be taking a $500 million charge in the fiscal second quarter.
Sun is holding a conference call with analysts at 9:30 a.m ET to further explain the preliminary results.
Sun, in Palo Alto, California, can be reached at +1-650-960-1300 or at http://www.sun.com.