Jan. 28 (Bloomberg) -- Sun Microsystems Inc., the fourth- largest maker of server computers, rose the most in eight years in Nasdaq trading after earnings topped analysts’ estimates.

Second-quarter profit, excluding reorganization costs and stock-based compensation, was 15 cents a share, Sun said yesterday. Analysts on average had estimated a loss of 9 cents, according to a Bloomberg survey. Sales were $3.22 billion, topping an estimate of $3.15 billion.

Chief Executive Officer Jonathan Schwartz is coping with the worldwide recession by slashing as many as 6,000 jobs and focusing on winning buyers for less-costly products. Customers are putting off purchases of expensive computers, he said. Sun also boosted software sales 21 percent last quarter.

“Macro worries factored in the customer discussions across all geographies,” Schwartz told analysts yesterday on a conference call. “These concerns resulted in decisions related to high-end system purchases being pushed out.”

Sun, based in Santa Clara, California, rose 87 cents, or 22 percent, to $4.86 at 4 p.m. New York time in Nasdaq Stock Market trading. That’s the biggest gain since January 2001. The shares lost 79 percent last year.

Schwartz, who took over as CEO in April 2006, announced plans in November to eliminate about 18 percent of the workforce. The cuts will be completed this quarter.

Savings Expected

Costs related to the shakeup totaled $222 million in the second quarter, which ended Dec. 28. The move will slice $700 million to $800 million from annual expenses, the company said.

“It will be critical for Sun to sustain its operating expense management over the next several quarters and aggressively implement its restructuring initiatives,” Maynard Um, an analyst at UBS AG in New York, said in a report today. He rates the shares “neutral.” “The top line is likely to continue to be pressured.”

Sun’s sales have dropped for four straight quarters and will probably continue to fall as demand for technology weakens, David Bailey, an analyst at Goldman Sachs Group Inc. in New York, said in a note today. He reiterated his “sell” rating.

While Sun doesn’t provide quarterly forecasts, Chief Financial Officer Mike Lehman said sales in the third quarter typically decline from the second. “We would certainly be remiss if we didn’t expect that,” Lehman told analysts.

Sun reported a net loss of $209 million, or 28 cents a share, in the second quarter, which ended Dec. 28. That compared with a profit of $260 million, or 31 cents, a year earlier.

Server sales fell 14 percent last quarter to $1.37 billion, accounting for 43 percent of sales. Revenue from storage products dropped 13 percent to $570 million. Services revenue declined 6.2 percent $1.28 billion.

Last year, Sun bought database-software company MySQL for $1 billion, letting the company offer more service contracts. Sun expects software revenue to reach about $600 million a year.

Sun ranks behind International Business Machines Corp., Hewlett-Packard Co. and Dell Inc. in server sales.

To contact the reporter on this story: Connie Guglielmo in San Francisco at cguglielmo1@bloomberg.net

Last Updated: January 28, 2009 16:06 EST