Sun Microsystems on Monday announced that it has applied a $1.051 billion non-cash charge to the fourth quarter of its fiscal year 2003, which ended June 30.
Sun had previously reported a $12m profit for the quarter, but in a regulatory filing with the US Securities and Exchange Commission Monday it revised those results. The company is now reporting a loss for the quarter of $1.039 billion, or $0.32 per share.
The non-cash charge is being taken because Sun has reduced its forecast of planned profitability levels for fiscal 2004, said Sun spokesman Andy Lark. "Our Q1 was particularly difficult due to market and competitive dynamics," he said. "That caused us to reassess our deferred tax asset value."
As a result of the reassessment Sun was no longer able to defer certain losses, Lark said. "This updated analysis required us to recognise a $1.051 billion non-cash charge," he said.
This analysis was conducted in accordance with the Statement of Financial Accounting Standards No. 109, Sun said.
The Santa Clara, California, computer maker also warned that it expected its loss per share for the current quarter, which ends Tuesday, to be somewhere between $0.07 and $0.10 per share, when calculated according to generally accepted accounting principles (GAAP).
Following Sun's revised earnings report, shares of the company had dropped 10% Monday evening, from $3.86 to $3.46 on the Island-ECN after-hours stock exchange.
Robert McMillan writes for IDG News Service