Sun Microsystems slumps to US$1.68bn loss

Sun Microsystems has posted a first quarter net loss of US$1.68bn, compared to an US$89m profit in the same period last year, as the supplier feels the bite of the global financial crisis

Revenue fell 7.1 per cent to US$2.99bn compared with US$3.2bn for the first quarter of the previous year.

Profit was hit by a US$1.45bn write-down of goodwill - believed to be due to a fall in the valuation of subsidiary StorageTek, acquired for US$4.1bn in 2005.

"Although we saw another quarter of growth in our Solaris-based Chip Multi-Threading and Open Storage systems, the economic downturn continued to weigh on our customers, especially those that contribute to our traditional high-end businesses," said Sun chief executive Jonathan Schwartz.

The company competes with IBM, HP and Dell in the server systems market, where many of the customers are financial services firms.

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