San Francisco – Scott McNealy, the often acerbic co- founder of Sun Microsystems Inc. and one of Microsoft Corp.’s harshest critics, said Monday he will step down immediately as chief executive of the company he has led since 1984.
Jonathan Schwartz, Sun’s president, will retain that position and take over as CEO, McNealy said as he announced third-quarter results that included a wider loss.
McNealy will remain chairman and a full-time employee of the Santa Clara-based company.
“This isn’t about me. It’s about a big moment in Sun’s history, and I’m proud to share that with you,” McNealy said on a conference call. “There’s lots more work to do, and I’m certainly going to stay around and support that.”
Sun’s shares surged more than 7 percent after the announcement.
Sun, the world’s fourth-biggest maker of server computers that run corporate networks, has campuses in Broomfield and Louisville, which is home to Storage Technology Corp. Sun acquired the data-storage systems manufacturer last year for $4.1 billion.
There are about 4,700 employees at the combined companies in Colorado.
Sun said in January it plans to close more than 120 offices in coming months and eliminate jobs in legal, administration and other areas as it consolidates the companies.
In Colorado, Sun said it would move about 1,200 StorageTek workers from Louisville’s campus to Broomfield’s.
Sun also purchased software maker SeeBeyond last year.
McNealy, 51, co-founded Sun Microsystems in 1982, developing it into a scrappy Silicon Valley startup whose high-powered computers, called workstations, became a major staple with engineers and businesses.
Following the collapse of the Internet bubble in 2000, he saw revenue decline and frequently came under pressure for not cutting costs enough.
McNealy’s move surprised some analysts because as recently as February he said he would keep his job as long as the board wanted him running Sun.
On Monday, Sun posted a wider fiscal third-quarter loss, as costs for acquisitions, stock-based compensation and restructuring chipped away at higher revenue. Losses for the three months ended March 26 totaled $217 million, or 6 cents a share, compared with $28 million, or 1 cent, in the same period last year. Revenue grew 5 percent to $3.18 billion, from $2.63 billion, as recent acquisitions boosted sales.
The results were announced after financial markets closed. Sun shares closed 5 cents higher, at $4.98, on the Nasdaq Stock Market. In extended- session trading, they gained 36 cents, or 7.2 percent.
Denver Post staff writer Kimberly S. Johnson and Bloomberg News contributed to this report.
