Being acquired by Oracle Corp., a higher rated entity; Good, but not leading, server market position; Strong, consistent product development skills, supported by significant R&D expenditures; Geographic revenue diversity (more than half of revenues come from international markets); and Use of partnerships to minimize fixed-asset investments and maintain a relatively low-capital-intensity operating model. Highly competitive industry; Server segments in which Sun historically has not had a strong position (such as Windows and Linux) are experiencing higher growth rates; Lack of consistent revenue growth; and Weak and inconsistent profitability. Santa Clara, Calif.-based Sun Microsystems Inc. ratings remain on CreditWatch with positive implications. The CreditWatch followed the announced $7.4 billion acquisition of Sun by Redwood Shores, Calif.-based Oracle Corp. (A/Stable/A-1). Net of
