Sun Microsystems raised sales 17% in the last quarter but still returned a $223m (£131m) loss. This is compared to a slender $4m net profit in the same quarter a year ago.
Sales rose to $3.34bn, but these were helped greatly by the acquisitions of StorageTek and SeeBeyond, last year.
In trying to defend the overall financial performance of the group, Sun’s outgoing chief financial officer Steve McGowan said the company's gross profit margin had increased 0.4%.
Sun is hoping it can return to profitability with the help of its new Galaxy and Niagara server lines.
Sun said its financial performance was not helped by unfavourable exchange rates and its inability to clear a backlog of demand for some of its latest products.