Sun CEO will announce thousands of layoffs this Thursday

[MikeNearMcChord]

by Tom Foremski
Sun Microsystems (SUNW) will announce on Thursday a large round of layoffs in a bid to cut about one-half billion dollars in annual costs as it transforms itself into a broad based computer software and services company.

Jonathan Schwartz, CEO of Sun, will make the announcement to staff and investors, said a Sun source. The cuts are expected but the timing was not known.

On May 31, Sun said it would have to cut 4,000 to 5,000 staff over the coming six months. This represents about 11 to 13 per cent of its global workforce of 37,500. Sun said the layoffs would provide cost savings of between $480m and $590m annually by its fourth fiscal quarter 2007. The layoffs will be the first under Sun's new CEO Jonathan Schwartz, who recently replaced co-founder Scott McNealy.

http://blogs.zdnet.com/Foremski/?p=88&tag=nl.e539

[Rabrrrrrr]

1. A friend of mine worked for Sun in the 80s, when it had like 12 employees

How that company has changed over the years! I lost touch with him, and have often wondered if he stayed and became rich, or stupidly left right before it exploded into $$$$$.

[thepurpose]

2. Does this stragery actually work. Every company does it, but if your

products or services are not what people are willing to pay for how profitable will you ever be by cutting work force. Its not income its money not spent.

[Warpy]

7. I read a study some time in the mid 90s

that followed companies that did "strategic layoffs" to boost stock prices. It worked to fatten management nicely, but the study found that companies that didn't do this performed much better over time, stock price and all.

Cutting your workforce to the bone just doesn't work, it seems, although it may generate quick paper profits for stockholders. Those stockholders would do well to sell immediately and then buy the stock back later, because there's always a compensatory drop after such a layoff.

[LiberalPartisan]

3. SUN should just close their doors.

They don't make a single product that can compete in the marketplace and what they do make is overpriced and basically garbage. JAVA has been dead for years and SUN won't be around much longer. They are the Digital Equipment Corp. of this era: a one time high flying company doomed by misstep after misstep taken by inept management and lack of creativity.

[Xipe Totec]

4. Yuck! Not good.

:(

[jody]

5. In the meantime, Sun gives grants to India to increase the number of

computer graduates.

SUN MICROSYSTEMS SPEARHEADS INDIAN TECHNICAL SKILLS DEVELOPMENT

QUOTE
Bangalore - April 26, 2006: As part of its education grants and donations program, Sun Microsystems India today announced the roll out of the Sun Matching Grant Program, for the second time, in India. Through this initiative, Sun will provide a series of hardware, software and web based training material, which will allow an unlimited number of Indian educational institutions and students to benefit from Sun's technology. As part of the Matching Grant Program conducted last year, a record 45 educational institutions utilized the opportunity to build and enhance their educational and learning infrastructure to meet world-class standards.
UNQUOTE

[Greyhound]

6. Damn I'm glad I spent all that $$ for my degree in Comp Sci.

:woohoo:

The future's so bright...