Cray to Buy Appro for $25 Million

By Richard L. Brandt

November 9, 2012

Cray CEO fills in Wall Street stock analysts during an early morning earnings phone call

Wall Street seemed pretty happy with Cray’s announcement this morning that it would buy Appro International, a 20-year-old HPC cluster vendor. After nearly two months of a steady decline, Cray’s stock price jumped 10 percent today on the news. At one point, shares were up 13 percent.

Cray is paying about $25 million for Appro, and will get at least $3.5 million in working capital, which is the sum of the money it’s owed from customers, plus the value of its inventory, minus the amount of money it owes its suppliers. Cray CEO Peter Ungaro said he expects Appro to contribute $60 million in revenue to the top line next year. Cray’s total revenue this year should come in at about $450 million.

The acquisition has not been closed yet. It first it has to be approved by the government, in order to ensure it doesn’t create a monopoly in the business. Ungaro noted that Appro is “the number three vendor across the top 100 supercomputers in the world, after IBM and us.” There will probably not be any problems with the deal, however, since IBM remains a strong competitor. Ungaro expects the acquisition to be completed within a few days to a couple weeks.

Still, it’s hard to say how much of that stock jump was the result of this morning’s announcement. Ungaro revealed details of the deal in an 8am EST phone call with Wall Street stock analysts, when he announced Cray’s third quarter financial results, which were generally upbeat.

Cray had a net loss of $5.2 million for the three-month period ended Sept. 30, but Wall Street was expecting worse—perhaps three times that loss. Ungaro also noted that Cray has already sold several units of the just-announced XC30 (“Cascade”) supercomputer, and some of them will be shipped by the end of the year, instead of early next year as originally expected. Cray has also delivered its Blue Waters supercomputer to the University of Illinois and Titan to Oak Ridge National Lab. Once those customers approve the computers—probably before the end of the year—Cray will collect another $180 million.

The Appro deal certainly didn’t put a damper on Wall Street’s enthusiasm. The most important element to this, according to Ungaro, is that it gives his company “one of the most advanced industry clusters in the world.” Cray gets the product line and a bigger sales team from Appro, while Appro gets inroads into overseas markets through Cray.

Appro could also help Cray grow in the big data market, a business that Ungaro said has “transformational potential for our company.” He expects the big data part of Cray’s business to grow 50 to 100 percent next year, although that would  still leave it as a relatively small share of the company’s sales.

One analyst on the earnings call, apparently wondering if the Appro acquisition was really done entirely for strategic reasons, asked why the purchase was made now: “Was the company for sale?” asked Glenn Hanus of Needham & Co.

Ungaro responded that Cray was in a good position to make this kind of investment. “We’ve been on a pretty nice roll lately.” He reiterated that Appro is “a natural fit for us,” adding that “this is a missing part of our puzzle.”

He also noted that Cray had been looking around for a vendor to fill that slot in the portfolio. “We’ve been talking to a number of different companies in this area.” But Appro, he said, “seems to be the best fit from a culture standpoint; how they think about products from an engineering-first perspective, not a marketing-first perspective.”

Cray’s customers seem pleased with the acquisition. Last night and early this morning, Ungaro told some of them about the deal under a nondisclosure agreement. “And I would tell you that they’re pretty excited, along with me. I was pretty happy to hear the response from our customers.”

Besides, Appro was not exactly a stranger to Cray. “As one of the leaders in HPC supercomputing, we’ve known Appro for quite a while as we’ve partnered with them on a couple of solutions. And they have been making waves recently with their rapid growth.” One of those collaborations was in Japan, but he didn’t give any word on whether it resulted in any sales.

The Appro acquisition won’t be the last we hear from the Cray CEO this month. SC12 is coming up next week and the company has plenty of news to trumpet. “You’ve seen some early announcements from us over the past two weeks, which will continue into next week as we show the market more new products than we’ve ever had at any one time, a refresh of nearly our entire product portfolio. It should be an exciting show.”

To hear more about the strategy behind the acquisition, listen to our special edition of HPC Soundbite in which Peter Ungaro explains how Appro’s product set will fit into Cray’s existing portfolio.


About the author

Richard Brandt has been writing about science, technology, business and environmental issues since 1981. Prior to joining Tabor Communications as managing editor of Green Computing Report in October 2012, he spent several years freelancing articles, and writing books about entrepreneurs. He has the distinction of having served as editor-in-chief of Upside magazine for five years, and as a technology correspondent for Business Week magazine for 14 years. Highly regarded as both a public speaker and commentator, Richard has won many awards, including a National Magazine Award, Atlantic Monthly Award, Computer Press Association Awards, and Maggie Awards. He was a Knight Science Journalism Fellow at the Massachusetts Institute of Technology, and a Science Journalism Fellow with the American Association for the Advancement of Science.

 

Subscribe to HPCwire's Weekly Update!

Be the most informed person in the room! Stay ahead of the tech trends with industy updates delivered to you every week!

Quantum Rolls – DOE Dishes $218M; NSF Awards $31M; US Releases ‘Strategic Overview’

September 24, 2018

It was quite a day for U.S. quantum computing. In conjunction with the White House Summit on Advancing American Leadership in Quantum Information Science (QIS) held today, the Department of Energy announced $218 million Read more…

By John Russell

Russian and American Scientists Achieve 50% Increase in Data Transmission Speed

September 20, 2018

As high-performance computing becomes increasingly data-intensive and the demand for shorter turnaround times grows, data transfer speed becomes an ever more important bottleneck. Now, in an article published in IEEE Tra Read more…

By Oliver Peckham

IBM to Brand Rescale’s HPC-in-Cloud Platform

September 20, 2018

HPC (or big compute)-in-the-cloud platform provider Rescale has formalized the work it’s been doing in partnership with public cloud vendors by announcing its Powered by Rescale program – with IBM as its first named Read more…

By Doug Black

HPE Extreme Performance Solutions

Introducing the First Integrated System Management Software for HPC Clusters from HPE

How do you manage your complex, growing cluster environments? Answer that big challenge with the new HPC cluster management solution: HPE Performance Cluster Manager. Read more…

IBM Accelerated Insights

Clouds Over the Ocean – a Healthcare Perspective

Advances in precision medicine, genomics, and imaging; the widespread adoption of electronic health records; and the proliferation of medical Internet of Things (IoT) and mobile devices are resulting in an explosion of structured and unstructured healthcare-related data. Read more…

Democratization of HPC Part 1: Simulation Sheds Light on Building Dispute

September 20, 2018

This is the first of three articles demonstrating the growing acceptance of High Performance Computing especially in new user communities and application areas. Major reasons for this trend are the ongoing improvements i Read more…

By Wolfgang Gentzsch

Quantum Rolls – DOE Dishes $218M; NSF Awards $31M; US Releases ‘Strategic Overview’

September 24, 2018

It was quite a day for U.S. quantum computing. In conjunction with the White House Summit on Advancing American Leadership in Quantum Information Science (QIS) Read more…

By John Russell

Summit Supercomputer is Already Making its Mark on Science

September 20, 2018

Summit, now the fastest supercomputer in the world, is quickly making its mark in science – five of the six finalists just announced for the prestigious 2018 Read more…

By John Russell

House Passes $1.275B National Quantum Initiative

September 17, 2018

Last Thursday the U.S. House of Representatives passed the National Quantum Initiative Act (NQIA) intended to accelerate quantum computing research and developm Read more…

By John Russell

Nvidia Accelerates AI Inference in the Datacenter with T4 GPU

September 14, 2018

Nvidia is upping its game for AI inference in the datacenter with a new platform consisting of an inference accelerator chip--the new Turing-based Tesla T4 GPU- Read more…

By George Leopold

DeepSense Combines HPC and AI to Bolster Canada’s Ocean Economy

September 13, 2018

We often hear scientists say that we know less than 10 percent of the life of the oceans. This week, IBM and a group of Canadian industry and government partner Read more…

By Tiffany Trader

Rigetti (and Others) Pursuit of Quantum Advantage

September 11, 2018

Remember ‘quantum supremacy’, the much-touted but little-loved idea that the age of quantum computing would be signaled when quantum computers could tackle Read more…

By John Russell

How FPGAs Accelerate Financial Services Workloads

September 11, 2018

While FSI companies are unlikely, for competitive reasons, to disclose their FPGA strategies, James Reinders offers insights into the case for FPGAs as accelerators for FSI by discussing performance, power, size, latency, jitter and inline processing. Read more…

By James Reinders

Update from Gregory Kurtzer on Singularity’s Push into FS and the Enterprise

September 11, 2018

Container technology is hardly new but it has undergone rapid evolution in the HPC space in recent years to accommodate traditional science workloads and HPC systems requirements. While Docker containers continue to dominate in the enterprise, other variants are becoming important and one alternative with distinctly HPC roots – Singularity – is making an enterprise push targeting advanced scale workload inclusive of HPC. Read more…

By John Russell

TACC Wins Next NSF-funded Major Supercomputer

July 30, 2018

The Texas Advanced Computing Center (TACC) has won the next NSF-funded big supercomputer beating out rivals including the National Center for Supercomputing Ap Read more…

By John Russell

IBM at Hot Chips: What’s Next for Power

August 23, 2018

With processor, memory and networking technologies all racing to fill in for an ailing Moore’s law, the era of the heterogeneous datacenter is well underway, Read more…

By Tiffany Trader

Requiem for a Phi: Knights Landing Discontinued

July 25, 2018

On Monday, Intel made public its end of life strategy for the Knights Landing "KNL" Phi product set. The announcement makes official what has already been wide Read more…

By Tiffany Trader

CERN Project Sees Orders-of-Magnitude Speedup with AI Approach

August 14, 2018

An award-winning effort at CERN has demonstrated potential to significantly change how the physics based modeling and simulation communities view machine learni Read more…

By Rob Farber

ORNL Summit Supercomputer Is Officially Here

June 8, 2018

Oak Ridge National Laboratory (ORNL) together with IBM and Nvidia celebrated the official unveiling of the Department of Energy (DOE) Summit supercomputer toda Read more…

By Tiffany Trader

New Deep Learning Algorithm Solves Rubik’s Cube

July 25, 2018

Solving (and attempting to solve) Rubik’s Cube has delighted millions of puzzle lovers since 1974 when the cube was invented by Hungarian sculptor and archite Read more…

By John Russell

House Passes $1.275B National Quantum Initiative

September 17, 2018

Last Thursday the U.S. House of Representatives passed the National Quantum Initiative Act (NQIA) intended to accelerate quantum computing research and developm Read more…

By John Russell

AMD’s EPYC Road to Redemption in Six Slides

June 21, 2018

A year ago AMD returned to the server market with its EPYC processor line. The earth didn’t tremble but folks took notice. People remember the Opteron fondly Read more…

By John Russell

Leading Solution Providers

SC17 Booth Video Tours Playlist

Altair @ SC17

Altair

AMD @ SC17

AMD

ASRock Rack @ SC17

ASRock Rack

CEJN @ SC17

CEJN

DDN Storage @ SC17

DDN Storage

Huawei @ SC17

Huawei

IBM @ SC17

IBM

IBM Power Systems @ SC17

IBM Power Systems

Intel @ SC17

Intel

Lenovo @ SC17

Lenovo

Mellanox Technologies @ SC17

Mellanox Technologies

Microsoft @ SC17

Microsoft

Penguin Computing @ SC17

Penguin Computing

Pure Storage @ SC17

Pure Storage

Supericro @ SC17

Supericro

Tyan @ SC17

Tyan

Univa @ SC17

Univa

Summit Supercomputer is Already Making its Mark on Science

September 20, 2018

Summit, now the fastest supercomputer in the world, is quickly making its mark in science – five of the six finalists just announced for the prestigious 2018 Read more…

By John Russell

Sandia to Take Delivery of World’s Largest Arm System

June 18, 2018

While the enterprise remains circumspect on prospects for Arm servers in the datacenter, the leadership HPC community is taking a bolder, brighter view of the x86 server CPU alternative. Amongst current and planned Arm HPC installations – i.e., the innovative Mont-Blanc project, led by Bull/Atos, the 'Isambard’ Cray XC50 going into the University of Bristol, and commitments from both Japan and France among others -- HPE is announcing that it will be supply the United States National Nuclear Security Administration (NNSA) with a 2.3 petaflops peak Arm-based system, named Astra. Read more…

By Tiffany Trader

D-Wave Breaks New Ground in Quantum Simulation

July 16, 2018

Last Friday D-Wave scientists and colleagues published work in Science which they say represents the first fulfillment of Richard Feynman’s 1982 notion that Read more…

By John Russell

MLPerf – Will New Machine Learning Benchmark Help Propel AI Forward?

May 2, 2018

Let the AI benchmarking wars begin. Today, a diverse group from academia and industry – Google, Baidu, Intel, AMD, Harvard, and Stanford among them – releas Read more…

By John Russell

TACC’s ‘Frontera’ Supercomputer Expands Horizon for Extreme-Scale Science

August 29, 2018

The National Science Foundation and the Texas Advanced Computing Center announced today that a new system, called Frontera, will overtake Stampede 2 as the fast Read more…

By Tiffany Trader

Intel Announces Cooper Lake, Advances AI Strategy

August 9, 2018

Intel's chief datacenter exec Navin Shenoy kicked off the company's Data-Centric Innovation Summit Wednesday, the day-long program devoted to Intel's datacenter Read more…

By Tiffany Trader

GPUs Power Five of World’s Top Seven Supercomputers

June 25, 2018

The top 10 echelon of the newly minted Top500 list boasts three powerful new systems with one common engine: the Nvidia Volta V100 general-purpose graphics proc Read more…

By Tiffany Trader

The Machine Learning Hype Cycle and HPC

June 14, 2018

Like many other HPC professionals I’m following the hype cycle around machine learning/deep learning with interest. I subscribe to the view that we’re probably approaching the ‘peak of inflated expectation’ but not quite yet starting the descent into the ‘trough of disillusionment. This still raises the probability that... Read more…

By Dairsie Latimer

  • arrow
  • Click Here for More Headlines
  • arrow
Do NOT follow this link or you will be banned from the site!
Share This