---------------------------------------------------------------------------- The Florida SunFlash SUN MICROSYSTEMS THIRD QUARTER RESULTS SunFLASH Vol 28 #14 April 1991 ---------------------------------------------------------------------------- MOUNTAIN VIEW, Calif. -- April 24, 1991 -- Sun Microsystems, Inc. (SUNW), today reported major year-to-year gains for its third quarter and first nine months of fiscal 1991, ended March 29, 1991. Revenues for the third quarter were $848.3 million, a 34% increase over the $632.2 million reported in the same period a year ago. Net income for the quarter increased 60% to $58.7 million, or $0.56 per share, from net income of $36.7 million, or $0.40 per share, in the corresponding period a year ago. For the first nine months of fiscal 1991, revenues were $2.279 billion, up 29% from the $1.766 billion reported in the corresponding period of fiscal 1990. Net income for the nine-month period nearly doubled to $123.9 million, or $1.21 per share, from the $62.1 million, or $0.70 per share, in the same period a year ago. William J. Raduchel, vice president and CFO of Sun, said "It was an excellent quarter for us in all respects. We reported a major increase in revenues, record bookings, we ended the quarter with a record backlog of orders, almost $700 million in cash and a balance sheet that's never been stronger. Despite concerns over the Middle East war and the recession, our business remained healthy. Apparently, our strategy of SPARC/UNIX/OPEN LOOK/ONC, is a winner with customers." Sun reported that it was enjoying considerable success in all three of its major geographies--the U.S., Europe and the Pacific Rim. Commenting on the company's financial results, Raduchel said, "Our operating margin improved a full 2 1/2 points from the second quarter, pushing it over the 10% mark, the highest it's been in nearly 3 years. Net income of about $59 million was 6.9% of revenues, also at the high end of our historical range. Clearly, employees throughout the company have responded aggressively to our calls for expense controls, judicious and conservative hiring, and improved asset management. As a result, our revenues per employee increased more than 20% in the past 12 months." Sun shipped a record 48,000 units in the quarter, with the SPARCstation IPC accounting for the largest share. Raduchel indicated that the IPC, introduced nine months ago, increased shipment volume substantially in the third quarter, jumping by about 50% from the prior quarter. Meanwhile, the relatively new SPARCstation 2, introduced last quarter, doubled in shipments during the quarter. "We seem to have the right mix of prices and capabilities to respond credibly to a broad range of customers seeking the advantages of client/server computing. Announcements made by competitors during the quarter only serve to highlight the appropriateness of our strategy ...and the substantial lead we have in implementing it. In fact, we are successfully penetrating many new applications areas, particularly in the commercial sector, which we estimate now accounts for about 30% of our revenues," Raduchel said. Sun reminds investors that as the company has grown and become increasingly global in nature, the seasonality prevalent in the computer industry is a now a factor for Sun as well. For this reason, the company cautions against expecting sequential quarterly gains in revenues, net income or earnings per share, especially in the first quarter (ending September) of each fiscal year. Because of this seasonal pattern, the company believes that year-over-year comparisons are more indicative of the company's true performance, progress, and position in the industry. Sun Microsystems is the world's leading supplier of client/server computing solutions, which feature networked workstations and servers that store, process, and distribute information. Used for many demanding commercial and technical applications, Sun products command the largest share of the computer industry's fastest growing market segment (workstations and servers). The company, founded in 1982 and headquartered in Mountain View, Calif., is a multibillion dollar corporation doing business worldwide. In 1990, about half of Sun's revenues were generated outside the United States. ### UNIX is a registered trademark of UNIX System Laboratories, Inc. OPEN LOOK is a registered trademark of AT&T. SPARC is a registered trademark of SPARC International, Inc. Products bearing the SPARC trademark are based on an architecture developed by Sun Microsystems, Inc. SPARC station is a trademark of SPARC International, Inc., licensed exclusively to Sun Microsystems, Inc. ONC is a trademark of Sun Microsystems, Inc. Contact: Austin Wing Mayer (415) 336-0699 ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ For information send mail to info-sunflash@sunvice.East.Sun.COM. Subscription requests should be sent to sunflash-request@sunvice.East.Sun.COM. Archives are on solar.nova.edu and paris.cs.miami.edu. All prices, availability, and other statements relating to Sun or third party products are valid in the U.S. only. Please contact your local Sales Representative for details of pricing and product availability in your region. Descriptions of, or references to products or publications within SunFlash does not imply an endorsement of that product or publication by Sun Microsystems. John McLaughlin, SunFlash editor, flash@sunvice.East.Sun.COM. (305) 776-7770.