Cray Gets $128 Million U.K. Supercomputer Contract

The multi-year deal with the U.K.'s national weather service is the latest win in what has been a strong year for Cray.

Cray supercomputer

Supercomputer maker Cray is on a roll.

The company on Oct. 27 announced that it had won a $128 million contract to supply supercomputers to the Met Office, the United Kingdom's national weather service. The systems will include multiple Cray XC40 as well as next-generation XC supercomputers, and the vendor's Sonexian storage systems. In all, once all the systems are in place, they will give the Met Office 13 times more supercomputing power than they currently have, according to Cray officials.

The day after announcing the Met Office contract, Cray executives disclosed that the company in the third quarter generated 159.4 million in revenue, almost three times more than the $54.4 million it saw in the same period in 2013. In addition, net income was $7.4 million, a significant improvement from the net loss of $11 million in last year's third quarter.

"It's really been an incredible run of wins for us," Cray President and CEO Peter Ungaro said in a conference call with analysts and journalists Oct.28. "In fact, since the beginning of the year, we've been awarded more than $800 million in new awards, an increase to well over two times where we were at this point last year. And like the U.K. Met award, many of these new contracts are multi-year in scope, contributing to our continued confidence in our ability to grow into the future."

The company has been aggressively expanding its product portfolio this year. For example, Cray in September unveiled the latest generation of its XC supercomputers armed with Intel's newest Xeon E5-2600 v3 "Grantley" processors and which offer twice the performance of their predecessors. The XC40 also comes with Cray's new DataWarp I/O acceleration technology, which connects solid-state drives (SSDs) directly to the compute nodes in the supercomputer, reducing the distance data has to travel, driving up performance and improving total cost of ownership, officials said.

A month later, the company unveiled the second of its appliances designed to address big data in the high-performance computing (HPC) space. The Urika-XA—coming two years after Cray launched its Urika-GD system—comes integrated with Apache Hadoop and Apache Spark frameworks to address big data analytics applications leveraging those open-source technologies.

Cray also has seen some significant wins. In July, the company was awarded a $174 million contract with the U.S. National Nuclear Security Administration (NNSA) for a supercomputer that will be used to help manage the country's nuclear stockpile. It was one of the largest contracts in the company's history.

Ungaro, talking about the U.K. Met Office deal, said the performance capabilities of Cray's systems, the company's technical expertise and the overall low total cost of ownership helped the vendor win a deal that was highly competitive and one in which Cray wasn't the incumbent.

"Beyond those tangible factors, I believe we're earning a level of trust throughout the industry that comes when you consistently execute on very large complex projects," he said. "Our proven track record of delivering large-scale production supercomputers creates a virtual loop of sorts as customers see our ability to deliver some of the largest, most productive systems in the world."

The Met Office deployment is an example. Cray will deliver multiple supercomputers and storage systems between now and 2017, with the bulk of the deliveries coming between 2015 and 2017. According to Cray officials, the Met Office combines more than 10 million weather observations each day and an advanced atmospheric model to develop 3,000 tailored forecasts and briefings per day. Those forecasts are delivered to an array of customers, from government agencies and the military to businesses and the general public.

Ungaro told the analysts and journalists that while it's difficult to forecast what 2015 holds—noting that there are some big deals that could go either way—the goal remains to grow the business at twice the market growth rates. He said the multi-year deals that the company has signed—such as the Met Office pact—bode well for the future.

"The big question that we're having right now is where is that exactly going to end up for 2015 and how can we give you guys the best view there," he said. "And we just got a few big contracts that we're working on that we got to nail down first, but we're definitely not changing our goals or our sights on that long-term view."