The CEO change "indicates that the financial market had finally come to the end of [its] patience more than anything," said Charles King, an analyst at Pund-IT Inc. in Hayward, Calif. "The company has had a really tough time over the last three or four years."

King called Schwartz, who is 40, "a conventional choice" for Sun. "This is a stay-the-course signal," agreed Rob Enderle, an independent analyst in San Jose. "In fact, the real question may be whether there is really any change at all, since the reporting relationships remain very similar."

However, Schwartz said he plans to conduct a "comprehensive review" of all aspects of the company over the next two months, leading into the start of Sun's next fiscal year. "We're going to be making sure we're aligning the organization for growth," he said.

Schwartz emphasized the importance of research and development, on which Sun spends about $2 billion annually. And regarding the issue of possible workforce cuts, the new CEO said the purpose of the planned review is "not to figure out how to take a whack at head count." But he added that Sun will do some "pruning" of operations that aren't yielding returns.

Schwartz announced some immediate changes last week. He said that Greg Papadopoulos, who has been Sun's chief technology officer, will be executive vice president of research and development. Schwartz also said there will be an increased emphasis on executive teamwork; for example, he plans to share an office with Mike Lehman, Sun's chief financial officer.