Business Insight Zone

Sun Microsystems has had a wild ride in recent years. After being one of the darlings of the tech bubble — in many cases, it was Sun’s servers that were running the Web sites for all those dot-com wannabes — the company suffered from intensified competition in servers from Dell, HP, and IBM.

But yesterday the Silicon Valley stalwart was able to give investors a pleasant surprise by announcing a bigger-than-expected quarterly profit of $329 million — the company’s third profitable quarter in a row. The dark cloud behind this silver lining is that Sun’s revenues were almost exactly what they were in the same quarter a year ago. So, the company’s cost-cutting plan has been effective (good), but it hasn’t been able to scare up a higher level of overall business even though the economy has been solid (bad).

Now the task for CEO Jonathan Schwartz and the rest of Sun will be to get the company growing again in a highly competitive market. Let’s see if the quarters to come will keep bringing fresh sunrises for Sun.