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Sun To Cut More Jobs

It's eliminating another 1,080 positions, about 3% of its workforce, in an effort to return to sustained profitability amid sagging sales.
SAN JOSE, Calif. (AP) -- Troubled computer and software maker Sun Microsystems Inc. plans to cut another 3 percent of its work force, or an estimated 1,080 jobs, in an effort to return to sustained profitability despite sagging sales.

"This strategic realignment is an ongoing business practice that allows us to allocate resources to meet the highest priorities of the business," the Santa Clara-based company said in a statement Thursday.

At the end of the last quarter, Sun reported it had 36,000 employees. At the end of fiscal 2001, by comparison, it had 43,683 workers.

Spokeswoman Mary Goh Petry said the bulk of the cuts would be made in the current quarter, though some will take place in the fiscal second and third quarters to comply with varying international labor laws.

The company also said it plans to hire in strategic, high-growth areas. Petry declined to specify what areas are targeted for cuts or new hiring.

"While we might be eliminating some jobs, we'll transferring many of those positions into areas of growth and investment for us," she said.

The company has been struggling to reinvent itself as its high-end--and high profit--equipment has been challenged by systems running the free Linux operating system and less expensive but increasingly powerful commodity hardware.

Sun's revenues have now fallen for nine straight quarters, and it is now offering its own Linux-based systems in addition to high-end machines.

In the most recent quarter, which ended June 30, Sun earned $12 million on sales of $2.98 billion. In the same period last year, it reported profits of $61 million on sales of $3.42 billion.