Sun announced its Q2 results for fiscal 2009 this week with both revenues and margin down year over year, but up slightly from Q1
Revenues for the second quarter of fiscal 2009 were $3.220 billion, a decrease of 10.9 percent as compared with $3.615 billion for the second quarter of fiscal 2008, and an increase of 7.7 percent as compared with $2.990 billion for the first quarter of fiscal 2009. Total gross margin as a percent of revenues was 41.9, a decrease of 6.6 percentage points as compared with the second quarter of fiscal 2008 and an increase of 1.7 percentage points as compared with the first quarter of fiscal 2009.
The company posted a loss for the quarter, primarily due to restructuring charges related to the layoff. However, the loss was much less than Q1, and doesn’t necessarily bode ill for future performance when taking the restructuring charge out of the picture and factoring increased savings in future quarters as severance packages and lease terminations, etc., finally move off the books and reduce operating expenses:
Net loss for the second quarter of fiscal 2009 on a GAAP basis was $209 million, or $(0.28) per share on a diluted basis, as compared with a net income of $260 million, or $0.31 per share, for the second quarter of fiscal 2008, and compared with a net loss of $1.677 billion, or $(2.24) per share, for the first quarter of fiscal 2009. GAAP net loss per share includes a restructuring charge of $222 million primarily related to the restructuring announcement of November 2008.
Looking at non-GAAP, which excludes some of the weird software and service revenue recognition rules, restructuring, impairment of goodwill, and a few other nutty accounting foohfarahs, the company made money
On a non-GAAP basis, net income for the second quarter of fiscal 2009 was $114 million, or $0.15 per share on a diluted basis, as compared with a non-GAAP net income of $409 million, or $0.50 per share, for the second quarter of fiscal 2008, and compared with a non-GAAP net loss of $65 million, or $(0.09) per share, for the first quarter of fiscal 2009.
As I’ve learned recently, non-GAAP results aren’t necessarily a facile ploy by companies to provide a ray of sunshine when the GAAP reporting puts them in a loss position. There are good reasons to consider both in evaluating the current health of a company, and non-GAAP results may give a better picture of actual day-to-day health, but it’s important to understand what’s been left out when you look at non-GAAP results. YMMV.