Sun Microsystems net soars 41% as margins rise
Article Abstract:
Sun Microsystems reported a net income of $178.3 million for its second fiscal quarter ended Dec 29, 1996, as the company focused on its high-end, high-margin systems. The earnings were a 41% increase over the $126 million netted during the same quarter one year earlier. Revenue for the Dec 29 quarter grew 19% from $1.75 billion in the previous year to $2.08 billion. Sun said that all product lines showed strong growth and declined to give specifics. The company's margins showed significant improvement, as well, and gross margins as a percentage of revenue reached 50.4%, up from 44.5% in the same quarter one year earlier. The growth comes primarily from sales of its workstations and servers using the UltraSparc processor and the Solaris OS, which provide better performance that systems running Intel chips and Microsoft applications. High-end systems can have margins of 40% or higher, and analysts say Sun is wise to concentrate on the upper-end, since Intel and Microsoft tend to dominate the lower-end of the server market.
Publication Name: The Wall Street Journal Western Edition
Subject: Business, general
ISSN: 0193-2241
Year: 1997
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Dell Computer profit soars, tops forecasts
Article Abstract:
Dell Computer exceeded Wall Street's projections by more than doubling its profit in the first qtr of its fiscal year, ended May 4, 1997. The company realized a net income of $198 million, or $1.08 a share, compared to the previous year's net income of $82 million, or 42 cents a share. Revenue rose 58% during the quarter to $2.6 billion, up from $1.6 billion during the same quarter in 1996. Dell's CEO, Michael Dell says the company's server unit more than quadrupled during the quarter, and that there have been across the board price reductions. Dell stock will be splitting if the share holders approve it at their July 18 annual meeting. The gross profit margin was 21.6% during the quarter and operating expenses fell to 10.9% from 12.9%.
Publication Name: The Wall Street Journal Western Edition
Subject: Business, general
ISSN: 0193-2241
Year: 1997
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