Any good financial news out of Sun Microsystems Inc is always greeted with ecstatic relief, because the wiseacres are constantly looking for the company to take a purler, and Sun’s fourth quarter outturn, with profits doubled to $72m and sales up 30% against a 20% increase for the full year, was extremely encouraging. Moreoever it is clear from the figures that with Sun now a $4,300m a year company, IBM Corp is not going to succeed in its objective of displacing Sun at the top of the Unix tree anytime soon. If the RS/6000 had had anything like such a good quarter as Sun has had, IBM would have trumpeted the news: instead, it said only that revenues grew in the quarter. Kevin Melia, Sun’s chief financial officer, commented We are very pleased with these results. We are particularly pleased with our 30% year-over-year revenue growth in the fourth quarter given the difficult economic environment in Europe. Revenue growth in the US and other geographies more than compensated for weak growth in European revenues. SunSoft Inc, the company’s system software subsidiary, distributed 140,000 Solaris and Unix licences, 117,000 of which were Solaris 2. The Sun Microsystems Computer Corp hardware arm shipped a record 71,000 systems and 92,000 Sparc processors during the quarter. In addition to our strong fourth quarter revenue growth, we achieved several important operational successes, said Melia: We are realising the benefits of the processes we initiated more than a year ago to control spending growth. Our revenues per employee grew 16% in the year, to a record $325,000. As a percentage of revenues, we reduced fourth quarter operating expenses more than 5.5 percentage points compared to the prior year, which more than offset the corresponding decline in gross profit margins. We have also continued our emphasis on asset management. Inventory turns and days sales outstanding both improved to record levels in fiscal 1993. The company also achieved a cash balance of more than $1,100m after buying in $200m of Sun’s shares during the year. While weak economies in Europe and other international markets pose a significant challenge for our first fiscal quarter and could exacerbate the normal summer seasonal weakness, our product lines are in an excellent position. The performance of our high-end Sparc-based systems is now 50% faster than in the first quarter of fiscal 1993, Melia concluded.
