Sun Microsystems Inc. is cutting up to 6,000 jobs, or 18 per cent of its global staff, in the latest round of layoffs by the technology giant.
The Santa Clara, Calif., company said Friday the cuts will affect more than 5,000 employees over the next year alone at a cost of $500 million to $600 million US.
But the company expects the move will save $700 million to $800 million annually by the third quarter of 2009.
Sun also announced that its software chief, Rich Green, has resigned.
Sun, best known to consumers for the Java programming language, is one of the world's biggest suppliers of large computer servers that run corporate networks and websites. It has counted on the financial industry as one of its bigger clients.
The economic crisis has added to the already slumping sales for its high-end computers.
On Oct. 30, the company released its financial results from the fiscal quarter ended Sept. 28, posting a net loss of $1.68 billion and a seven per cent year-over-year drop in revenue to $2.99 billion.
Once the apple of Wall Street's eye, the company has fallen on hard times since the dot-com bubble burst in late 2000.
Its shares traded at a high of about $64 in September 2000, but were trading at $4.08 at Thursday's market close.
Sun has also shifted direction in the last year, moving toward open-source software, or software where the code is open and shared and can be added to or modified by those following the conditions of a public licence.
In January, the company moved further in that direction when it announced it would buy open-source software maker MySQL AB for $1 billion.
The Swedish-based MySQL makes open-source database software used by companies such as online search leader Google Inc., popular social networking site Facebook Inc. and Finnish phone maker Nokia Corp.
This is the second announcement of layoffs at the company this year. In May the firm said it would cut between 1,500 and 2,500 jobs.