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February 3, 2014

Cray Captures $43 Million in Military Contracts

Nicole Hemsoth
Cray

Despite what the weather reports indicate, it’s been a sunny day in Seattle…

The U.S Department of Defense has just revealed eight new major contracts for a diverse range of agencies, including the Army, Air Force, Navy, and Defense Logistics Agency. All told, the DoD laid down word on over $212 million in new investments. In the midst of large equipment contracts for Lockheed Martin, medical and surgical equipment, and steel armories, one name stood out from the rest due to its relevance here.

Cray has been was awarded a $21,800,000 modification to a current contract to acquire a “balanced, commercially available, production-grade high performance computing systems to conduct complex, large-scale scientific calculations at the U.S. Air Force Research Laboratory DoD Supercomputing Resource Center.”  The project is expected to be complete in July of 2018 with work will be performed at Wright-Patterson, Air Force Base, Ohio and via the Army Corps of Engineers in Huntsville, Alabama, which is where the project originates.

A matching award was also announced today ($21,800,000) for another HPC system for large-scale scientific calculations for the U.S. Navy DoD Supercomputing Resource Center John C. Stennis Space Center in Mississippi, which is also due to emerge in July of 2018.

This is, of course, excellent news for the supercomputer maker, which is expected to announce its financials for the last quarter and whole of the full year of 2013 as well on Feb. 13. Execs will be on the call for a Q&A, and we’ll add to the query stream on this specific item. We’ll update this piece as we get more information.

UPDATE* Tuesday, 5:46 p.m. Eastern

John West from the DoD Modernization Program offered us some insight into his organization’s involvement inthe story, noting:

“Each year the DoD HPC Modernization Program executes an expansion of its installed base of supercomputers; this is part of that annual technology refresh. Our procurement budget for these acquisitions runs between 40M and 50M annually. The model is that when we acquire a new machine at one of our centers we run it for 48 months (typically), at which point it is no longer economically advantageous for our Program to continue to operate on behalf of the DoD relative to the value a newer resource would provide us, and the machine is decommissioned. As machines are decommissioned the new machines take their place. We have five centers, each center has between 1 and 3 machines, and existing centers retire old systems and get a new system roughly once every other year.”

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