Updated from 10:31 a.m. EDT

Sun Microsystems

(SUNW) - Get Report

said its charismatic chief operating officer, Ed Zander, will be leaving his position at the end of the current quarter.

As of July 1, Zander will step back into a mentoring role and retire from his management role, following four years in the COO spot, three years with the title of president and 15 total years of company service.

Investors pushed Sun shares down a sharp 15% in recent trading on the news, alarmed by four top-level executive changes in the past two weeks. Just last week, Chief Financial Officer Michael Lehman announced he would be stepping down, after grooming VP of Finance Steve McGowan to follow him. Before that, Larry Hambly, executive vice president of the Enterprise Service group retired, preceded by John Shoemaker, EVP for Computer Systems who kicked off the management turnover process on April 16.

In morning trading Sun shares fell sharply, down 15% following an executive conference call with analysts.

Sun does not plan to appoint a replacement for Zander, a dispiriting thought as Sun struggles to get back to promised profitability this quarter. CEO Scott McNealy will reabsorb the president's duties.

McNealy, typically colorful, emphasized that there is no plan to find a new COO or CEO, for that matter. "This hasn't been any news to me. I know it's a little tough for you all, " McNealy barked. He said that the stock-market downturn pushed off several executives' plans to retire, but with the company returning to profitability this quarter and the fiscal year plan set by July 1, he argued that the changes come at the right time for a smooth transition. To dispel the notion that he might be looking for a change, he boasted that he's "having a blast."

Robertson Stephens analyst Eric Rothdeutsch expressed one of several fears brought by the departure in a note to clients: "We are left wondering whether the roles of visionary and operations tactician can effectively be addressed by a single individual."

Additionally, Wall Street is clearly concerned that more management changes could be afoot, which McNealy did not confirm or deny. Zander defended the spate of retirements by characterizing them as "asynchronous," regardless of the close timing. "You can't lump these together as business decisions," he said. "These are life events that we go through."

Investors might scoff at the idea that the old guard is leaving now that Sun is once again in the clear. Sun shares are down 37% year to date, following an awful 2001 that saw Sun's dot-com and telecom customers head for the exits. The company's business fortunes tumbled again after Sept. 11 and the following work disruption. Sun only recently regained its financial footing to the point where it expects to break back into the black in the current quarter, its fourth quarter of fiscal 2002.

McNealy confirmed that Sun is on track to reach profitability with two months left to go in its quarter. "June 30 is my last day as president," said Zander. "I plan to bring the quarter home."