Updated from 4:26 p.m. EDT
Sun Microsystems (SUNW) on Tuesday topped Wall Street's earnings target for its fiscal fourth quarter even as sales growth continued to elude the technology giant.
After hours, shares of the network computer company recently rose 14 cents to $3.99 on the results, as company executives continued to focus on improvements and initiatives that they hope will eventually lead to sales growth.
"We feel we have a lot of momentum," said CFO Steve McGowan during a conference call. He cited improved gross margins, reduced spending on overhead and R&D, continued positive cash flow and a "stabilization of revenue."For the quarter ended June 30, Sun reported net income of $121 million, or 4 cents a share, on sales of $2.98 billion. During the same quarter last year, the company earned $783 million, or 23 cents a share, on sales of $3.11 billion. Excluding one-time charges and benefits, Sun earned 6 cents a share vs. a loss of 5 cents a share in the same quarter last year. Analysts had expected earnings excluding charges of a penny a share and sales of $2.98 billion, on average, according to Thomson First Call. As for indicators of what's to come, Sun's book-to-bill ratio for its products was 1.03-to-1, its total product and services backlog grew to $1.45 billion from $1.33 billion in the third quarter and deferred revenue rose to $2.19 billion from $1.91 billion in the previous quarter. Sun, as usual, does not provide targets for upcoming periods, but the executives did say they expected to be profitable for the new fiscal year. This target excludes the impact of any acquisitions, including the buyouts of StorageTek (STK - Get Report) and SeeBeyond (SBYN), and the expensing of employee stock options.