Sun Microsystems said Internet companies
continued to buy networked computers and equipment through the Y2K
preparations period, helping boost its second-quarter profits
Sun reported Thursday that its profit in the three months ended
Dec. 26, its fiscal second quarter, totaled $353 million, or 21
cents a share. That compares to a profit of $261.4 million, or 16
cents a share, after charges for acquisitions, in the year-ago
Sun, based in Palo Alto, was expected to earn 20 cents a share,
according to a survey of analysts by First Call/Thomson Financial.
Forecasts published on the Internet shortly before the
announcement, called whisper numbers, had predicted per-share
earnings as high as 22 cents a share.
Sun's shares have more than tripled this past year amid brisk
sales of network equipment, powerful desktop computers and servers,
machines that run computer networks. Driving demand is a growing
number of companies planning to create or expand their business on
Sun's sales have outpaced rivals IBM Corp. and Hewlett-Packard
Co., and the company has beat or matched earnings expectations for
five consecutive quarters.
"Sun continues to capture market share as we set the agenda in
the 'dot com' era," said chief executive Scott McNealy.
Revenues reached $3.55 billion, up 27 percent from $2.784
McNealy said Sun found virtually no slowdown in sales in the
past quarter despite fears many companies would stop buying in
advance of the Y2K turnover. Sales to financial services firms in
England were the only area where Sun saw a slowdown in buying,
"A year ago, I was talking to you about the Y2K slowdown,"
McNealy said. "Well, it didn't happen. It just flat out, didn't
IBM reported in its earnings announcement a day earlier that
profits tumbled 11 percent amid a slowdown in corporate spending
because of Y2K, although the company met Wall Street forecasts.
For the first six months of the fiscal year, Sun reported net
income of $625.5 million, or 37 cents a share, up from $372.9
million, or 23 cents a share, a year earlier. Revenues rose to $6.7
billion from $5.3 billion.