Sun Microsystems Report

Capital; expenditures decline from 45.8% of revenues in 1995 to 10.8% of revenues by 2001 (also close to Microsoft’s experience);

I. Rate of Return on Total Assets: Measures the company’s profitability relative to total assets. A percentage increment for Company G, from 12.30% to 13.68% (2011-12) keeps them above industry benchmarks (8.60% and 12.30%). Rate of Return on Total Assets represents strength for Company G.

As a manager of my company’s web-design and web-hosting specialist and programmers, I need to satisfy the CEO’s request to improve the team’s performance. In order to accomplish this, I will develop a system of output control systems to assess performance through financial measures, organizational goals, and operating budgets. Furthermore, using financial measures of performance will evaluate performance through profit ratios, which measures how efficiently managers are using the organization’s resources. While generating profits, I will also be calculating the organization’s net income before taxes divided by its total assets, also known as return on investment. After calculating this, I will calculate the difference between the amount of revenue generated and the resources used to produce the product through a process called gross profit margin.

The DuPont Analysis is a type of analysis that provides a more detailed look at a company's Return on Equity (ROE) by breaking it into three main components. The three components are profit margin, asset turnover and a leverage factor. By separating the ROE into these smaller categories, investors can quickly identify how effectively or efficiently a company is using their resources. If any of the three categories is performing poorly then this can lower the overall figure. To calculate a firm's ROE through Du Pont analysis, multiply the profit margin (net income divided by sales), asset turnover (sales divided by assets) and leverage factor (total assets divided by shareholders' equity) together - the higher the result, the higher the return on equity.

Revenues of Dell increased on 1285% against 660% of Compaq (1992-1998). From this data it can be seen that at Dell net income gross exceeds the revenue gross, while Compaq didn 't succeed to use the revenues incline to make income.

The return on equity (ROE) is the main ratio focused by the investors. ROE is divided into two extra ratios which are return on assets (ROA) and equity multiplier (EM). ROA is a mixture of expense ratio and revenue ratio which is also recognized as asset utilization. The total expense ratio contains of total non-interest expense, total interest expense ratio to total assets ratio, income tax to total asset ratio and provision for loan losses to assets ratio. The asset utilization contains of total non-interest revenue to total assets ratio and total interest revenue to total assets ratio.

For-profit companies are, by definition, created to make money, or a profit. They allocate resources towards the goal of earning revenue. Shareholders and stakeholders both benefit when a company’s profits increase and many companies today are investing in new technology, usually at a high cost. The goal is that the new technology will bring more business, thus more profits. When a company underperforms despite the heavy investments in new technology, it is the manager’s responsibility to communicate upwards to the shareholders what the company’s performance is, why the loss happened, and what changes will be made going forward to correct the issue.

Return on Equity has increase form 1.12% in 2015 to 6.33 percentage for 2016. Suggesting a management to a higher return equity, using the capital invested by shareholder

Next is Asset turnover with .55 times which is a measure of the efficiency of asset utilization. Finally the equity multiplier with 2.26 which is a measure of financial leverage of the firm. When compared to the traditional ratios we get similar results; Profit margin 25.44% (27% DuPont) versus 18.75% industry average. Asset turnover is .54 (.55 DuPont) versus .50 industry average. Equity multiplier 2.28 times (2.26 times DuPont) versus 2 times industry average. The results show that the DuPont analysis using ROE as the main determinant are very similar to the regular ratios. Furthermore the ROE of the traditional ratio is 31.32% with DuPont being 33.10% versus the industry average of 18.75% shows that the firms ROE is very robust. While the firm has some challenges with respect to liquidity and inventory management, as well as debt management it still is doing a good job with respect to its shareholders. However it could be doing a little better for the stockholders, and needs to address some of the above issues mentioned.

Historically, the Du Pont innovation of (ROI) calculations represents one of the most significant turning points in the history of modern accounting and management, (Hounshell, 1998 ). The 1920’s began the Du Pont system company with methods and calculations from leaders, owners, executives, etc. Furthermore, it was the beginning of the integration of financial accounting, capital accounting, and cost accounting. When it comes to return on assets (ROA), they are a (ROI) measure that evaluates the organization’s return or net income relative to the asset base need to generate the income, (Finkler, Ward, & Calabrese, 2013). The Du Pont Company has been the leader of industrial research. Throughout the years with companies emerging, Du Pont’s method was becoming more prominent with owners and executives needing a method for

Ford earned $1.90 per share ending 2010. The company showed a 5% return on sales. A comparison of General Motors Company will show Ford’s performance when comparing this percentage. High risks in business either equates to high profits or high losses. Ford’s company’s return on equity of 109% shows that their risks proved to be profitable in the automobile industry in 2010 (“,” 2012).

Our choices led to a constant increase in net income over the three years. Short term debt increase by approximately 100% percent but steadily reduced over the next three years. We were happy with the positive growth of the company and the fact that we were able to pay off most of the initial short term funding required by the increase in working capital requirement. Overall the current situation of the company in 2018 is good, although the total value created is less than 20% of that created in phase 1. From this we learned that the value of the firm can be significantly increased more through a reduction in working capital requirement than through increasing the firm’s sales and net income.

This thesis will discuss the corporate strategy of Sun Microsystems and the multiple issues they have faced both domestic and internationally. Sun Microsystems provides open source software applications and different types of hardware for business consumers. A benefit Sun Microsystems provides with new technology to customers is offering them the ability to trade computer parts when upgrading.

By the late 1990s, HP’s business was facing major problems which are reflected in its financial results. Despite a 9.71% increase in total net revenue, HP faced declining net earnings of 6% from 1997 to 1998. The company had also experienced a slow and decreasing growth in revenue in comparison to its main competitors. From 1996 to 1998, HP’s annual revenue growth decreased from 21.89% to 9.71%, while one of its main rivals, Dell, was able to maintain an over-40% revenue growth in each year within the same period. Moreover, HP’s failure to satisfy customer needs and catch

Sun Microsystems, Inc. is a worldwide provider of products, services and support solutions for building and maintaining network-computing environments. The Company sells scalable computer systems, high-speed microprocessors and high performance software for operating network computing equipment and storage products. The Company also provides support, education and professional services. The Company's products are used for many demanding commercial and technical applications in various industries including telecommunications, manufacturing, financial services, education, retail, government, energy and healthcare. Sun Microsystems' lines of business include Computer Systems and Storage, Enterprise Services, Software