Sun resumes buying back shares

Sun Microsystems' cash position is good enough that it has begun buying back its shares, Chief Financial Officer Mike Lehman said Wednesday. "As of now, we are deciding to go back into the market because we are now confident that we are generating enough cash," Lehman said at the company's analyst meeting here.

Sun had suspended its buyback program to cope with the plunging server market. Sun also expects its gross margins--a key measure of profitability--to improve as it moves to its new UltraSparc III generation of servers, Lehman said.