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Sun Microsystem's (NASDAQ: JAVA) Open Storage efforts shone in the company's March quarter just in time for Oracle (NASDAQ: ORCL) to figure out what to do with the program.
Sun's overall sales declined by 20 percent in the quarter to $2.61 billion, about $240 million below analysts' estimates. The company reported a net loss of $201 million, but its cash burn slowed to just $18 million in the quarter, as the company ended the quarter with $2.99 billion in cash and marketable securities and $1.26 billion in long-term debt.
Sun did not hold a conference call after issuing the report, which could be its last before it is acquired by Oracle.
Of Sun's key growth areas Total Software, Open Storage, Solaris-based SPARC CMT Servers and X64 Servers Open Storage posted the strongest growth, with a 63 percent jump in billings.https://o1.qnsr.com/log/p.gif?;n=203;c=204650394;s=9477;x=7936;f=201801171506010;u=j;z=TIMESTAMP;a=20392931;e=i
With $127 million in billings in the last four quarters, Open Storage is just a small part of Sun's $2 billion storage business, but it's the only part of the business showing substantial growth. Tape storage eked out a 3 percent gain in the quarter, but the rest of Sun's storage business was down by more than $100 million.
"Amber Road was the best thing Sun ever did in storage," said Illuminata analyst John Webster. "It took them decades but they finally got it right. Alas, too late to save them."
While the company's cash burn rate has slowed to a crawl, Webster thinks Sun did the right thing by selling the company.
"Perhaps they could have survived for years, but at what value? As a publicly traded company, the board has a fiduciary responsibility to maximize shareholder value, so it's not just about survival," he said.
The Oracle-Sun merger is expected to close this summer.
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