Sun shines in the second quarter

Sun Microsystems exceeded analyst expectations by one cent for its second fiscal quarter because of strong server sales into the Internet space.

The company saw revenue rise 27 per cent to $3.55 billion compared with the same period last year, while net income increased by 30 per cent to $353 million or $0.21 per share. Analyst First Call had predicted that Sun would earn $0.20 per share.

The firm's shares closed up $3 5/8 at a 52-week high of $86 9/16 ahead of the earnings report, which was released after the bell.

For the first six months of fiscal 2000, Sun also generated revenue of $6.7 billion, up 26 per cent from the same period last year. Net income grew by 34 per cent to $629 million.

"Sun continues to capture market share as we set the agenda in the dot com era," said Sun chief executive Scott McNealy.

The company's shares have more than tripled in value over the past year amid brisk sales of network equipment, desktop computers and servers. Phil Rueppel, an analyst at Deutsche Banc Alex Brown, said: "I don't see anything stopping the build out of Internet infrastructure. Sun is the leader in that market."