Sun Microsystems (NASDAQ:JAVA) has not done much right in the last few years. The company replaced founder Scott McNealy as CEO with Jonathan Schwartz who wears a ponytail and writes a blog.
The promised turnaround at Sun fell apart as the company announced lower sales and a loss. At the server firm, revenue for the third quarter of fiscal 2008 was $3.266 billion, a decrease of 0.5% as compared with $3.283 billion in the same quarter a year ago. Sun posted a net loss for the quarter of $34 million, or 4 cents per share, as compared with net income of $67 million, or 7 cents per share, last year.
Sun's plans to compete with the likes of IBM (NYSE:IBM) and other larger rivals have fallen apart. According to the company, the economy has not helped.
Sun may blame the economy, but it has run out of excuses. It will fire another 2,000 or so employees. Schwartz should be among them. The company's board should have difficulty viewing him as a viable leader, but it has made the great mistake of doing nothing.
Sun's shares traded below $14 after hours yesterday, which would put them under their 52-week low. The company's performance is humiliating and it is a sad fact that so many people have to pay for the inability of Schwartz to keep his promise of making the company a viable competitor.
Douglas A. McIntyre is an editor at 247wallst.com and author of the Ten Stocks Under $10 letter.
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