Sun Microsystems Inc. (JAVA) fell Tuesday after it announced the company will cut more than 3,000 workers ahead of its merger with rival software-maker Oracle Corp. (ORCL). The $7.4 billion deal still requires approval by the European Commission. Sun made the disclosure in a filing with the Securities and Exchange Commission on Tuesday.

KeyCorp (KEY) reported a wider loss in the third quarter as the housing crisis continued to take its toll on the Cleveland-based banker. Shares of the company slipped nearly 3 percent in after-hours trading ahead of Wall Street's opening bell. KeyCorp lost $438 million, or 52 cents a share, compared with a loss of $48 million, or 10 cents a share, during the same quarter a year ago. Analysts in a Thomson Reuters survey had expected on average loss of 41 cents a share.

Drug maker Eli Lilly & Co. (LLY) turned to profit in third quarter, earning $948.1 million, or 86 cents a share. Excluding restructuring and other costs, Lilly earned $1.20 a share. Analysts expected $1.02 a share. A year ago, the Indianapolis company lost $456.6 million, or 43 cents a share, after accounting for legal costs to settle government investigations into its Zyprexa schizophrenia drug. Lilly shares were higher in pre-market activity, up more than 1.5 percent to $35.80 a share.

More earnings in brief:

• Morgan Stanley (MS) posted its first quarterly profit in a year, earning $757 million, or 38 cents a share, for the third quarter. Though down sharply from the year-ago profit of $7.7 billion, or $7.38 a share, this year's third-quarter results beat analyst estimates of 30 cents, according to a poll by Zacks.com.
• Wells Fargo & Co. (WFC) doubled its third-quarter profit compared to a year ago. The San Francisco banking giant reported earnings of $3.2 billion, or 57 cents a share.
• Investment-banker Piper Jaffray Cos. (PJC) reported it earned $9.7 million, or 47 cents a share. A year ago, the Minneapolis-based firm posted a loss of $27.5 million, or $1.75 a share.

Select analyst calls:

• RBC Capital Markets commenced coverage of Travelers Cos. (TRV) and Automatic Data Processing Inc. (ADP) as Outperform and Paychex Inc. (PAYX) as Market Perform.
• Lexmark International (LXK) raised to Neutral at JPMorgan.
• Barclays (BCS) started as Outperform at FBR.
• Brinker International Inc. (EAT) cut to Neutral at Goldman Sachs.