Sun's Big Charge a Bad Sign for the Quarter

Updated from Sept. 29

Shares of Sun Microsystems(SUNW Quote) were dropping sharply Tuesday, a day after the tech giant announced it would take a noncash charge of $1.051 billion for its already-reported June quarter. The accounting maneuver reflects worries over the soon-to-close September quarter -- concerns that were reflected in Sun's share price. In recent trading, shares were down 56 cents, or 14.5%, to $3.30.

As a result of the charge, the company's slim $12 million profit for the June quarter has now turned into a massive loss of $1.039 billion. Instead of break-even earnings per share, the company has a loss of 32 cents a share, according to generally accepted accounting principles.

After the close Sun shares dipped 32 cents, or 8.2%, to $3.54. In regular trading the stock had closed 2 cents higher, up 0.5%, to $3.86. ...