Cray Charts A Road Out Of The Red

Cray, the troubled supercomputer company beset by high costs and difficulty cracking commercial markets, will try to surmount both problems with a new road map it’s making public this week.

The company, whose systems are used by the country’s national labs and the Homeland Security Department, carries hefty research and development costs as a result of supporting four computer architectures collected through mergers and acquisitions. Cray sells four lines of supercomputers: a high-end system based on Advanced Micro Devices’ Opteron chip; a vector processor machine; and systems based on technology from the former Tera Computer and OctigaBay Systems, now part of Cray.

By 2010, Cray plans to sell one system capable of housing boards that contain vector processors, scalar chips such as Opteron, and specialized field programmable gate arrays. Compilers and other software would be able to route pieces of applications to the processor type that can run them fastest, says Senior VP Jan Silverman. The move would reduce the company’s engineering costs. Cray plans a first step next year with a common programming environment across its platforms.

Cray lost $10.3 million on sales of $44.7 million during the third quarter last year. Adding to its woes, its former chief scientist, Burton Smith, departed in November to join Microsoft. The company's stock (Nasdaq-Cray) is trading at less than $2 a share, and the shares fell in price on Friday when Cray said it had delayed filing its 2005 annual report while it determines whether revenue from a product development contract was improperly booked. On a preliminary basis, Cray said it lost $9 million in the fourth quarter on revenues of $65 million.

But Cray still has its believers. Last week, an Indian government-run weather forecasting center said it purchased a Cray X1E vector supercomputer for the country’s fastest weather-prediction system, and an Indian institute bought one to conduct plasma research.