SAN JOSE, Calif. – Sun Microsystems Inc.'s third-quarter earnings fell 73 percent, but still beat Wall Street expectations.
The maker of high-power computer servers and workstations earned $136 million, or 4 cents a share, during the three months ended April 1, compared with $509 million, or 15 cents a share, last year.
Excluding one-time and other special charges, Sun's profits were $263 million, or 8 cents per share, compared with $464 million, or 15 cents a share, a year ago.
Analysts were expecting profits of 7 cents a share, according to a survey by Thomson Financial/First Call.
As is the case with other high-tech companies, the drop in profits reflect a drop in demand amid the economic downturn, which Sun first began to feel at the end of the second quarter.
At the time, Sun slightly scaled back its revenue growth forecast from 35 percent to 30 percent.
For the third quarter, the company's revenues totaled $4.1 billion, up 2 percent from $4 billion in the same period last year.
Sun is rolling out new servers built on its delayed UltraSparc III processor. Earlier this week, the company slashed prices by as much as 16 percent on older machines that use the UltraSparc II processor.
The company competes mainly with Hewlett-Packard Co. and IBM Corp. Sun officials have said the company's share of the high-end computer market will increase with its new products.
In addition to powering some of the world's busiest Web sites, the company's products are used to run large databases and to perform scientific and engineering research.
Shares of Sun closed up more than 11 percent Wednesday, to $20.71, on the Nasdaq Stock Market. In after-hours trading, Sun fell 63 cents to $20.08.
Get all the stories you need-to-know from the most powerful name in news delivered first thing every morning to your inbox