News

SAN FRANCISCO (MarketWatch) -- Sun Microsystems Inc. said late Friday that it cut its first-quarter loss from the same period a year ago, but sales fell across all of its main product lines as the computer server and software developer continues to be negatively impacted by its drawn-out acquisition by Oracle Corp.

Sun released the results in a Securities and Exchange Commission filing after the market closed.

According to the filing, the company lost $120 million, or 16 cents a share, on revenue of $2.24 billion for the quarter ended Sept. 27. During the same period a year ago, Sun lost $1.68 billion, or $2.24 a share, on $2.99 billion in sales.

The company has remained in limbo to a degree since Oracle agreed to acquire Sun in April for $9.50 a share, or approximately $7 billion. Since then, Sun's shareholders have approved the acquisition, and U.S. regulators have signed off on the deal.

However, the European Commission has postponed a decision on the acquisition until late November, leaving the final closing of the deal on hold. See full story.

Sun said the delays, coupled with the weak economy, resulted in decline is sales of its storage and server products, in particular.

"[The revenue decrease] was primarily due to the economic downturn and consolidation of our customer base," Sun said, in the filing. "Specifically in the financial services sector, as projects were scaled back, delayed or canceled, in addition to the uncertainty associated with the proposed acquisition by Oracle.

Sun said its server product sales declined by more than 31% to $862 million, while revenue from storage products fell almost 36% to $325 million. Services revenue also declined by a total of 14% to $1.06 billion.