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!

Graphcore Introduces Next-Gen Intelligence Processing Unit for AI Workloads

July 15, 2020

British hardware designer Graphcore, which emerged from stealth in 2016 to launch its first-generation Intelligence Processing Unit (IPU), has announced its next-generation IPU platform: the IPU-Machine M2000. With the n Read more…

By Oliver Peckham

heFFTe: Scaling FFT for Exascale

July 15, 2020

Exascale computing aspires to provide breakthrough solutions addressing today’s most critical challenges in scientific discovery, energy assurance, economic competitiveness, and national security. This has been the mai Read more…

By Jack Dongarra and Stanimire Tomov

There’s No Storage Like ATGC: Breakthrough Helps to Store ‘The Wizard of Oz’ in DNA

July 15, 2020

Even as storage density reaches new heights, many researchers have their eyes set on a paradigm shift in high-density information storage: storing data in the four nucleotides (A, T, G and C) that constitute DNA, a metho Read more…

By Oliver Peckham

Get a Grip: Intel Neuromorphic Chip Used to Give Robotics Arm a Sense of Touch

July 15, 2020

Moving neuromorphic technology from the laboratory into practice has proven slow-going. This week, National University of Singapore researchers moved the needle forward demonstrating an event-driven, visual-tactile perce Read more…

By John Russell

What’s New in HPC Research: Volcanoes, Mobile Games, Proteins & More

July 14, 2020

In this bimonthly feature, HPCwire highlights newly published research in the high-performance computing community and related domains. From parallel programming to exascale to quantum computing, the details are here. Read more…

By Oliver Peckham

AWS Solution Channel

INEOS TEAM UK Accelerates Boat Design for America’s Cup Using HPC on AWS

The America’s Cup Dream

The 36th America’s Cup race will be decided in Auckland, New Zealand in 2021. Like all the teams, INEOS TEAM UK will compete in a boat whose design will have followed guidelines set by race organizers to ensure the crew’s sailing skills are fully tested. Read more…

Intel® HPC + AI Pavilion

Supercomputing the Pandemic: Scientific Community Tackles COVID-19 from Multiple Perspectives

Since their inception, supercomputers have taken on the biggest, most complex, and most data-intensive computing challenges—from confirming Einstein’s theories about gravitational waves to predicting the impacts of climate change. Read more…

Joliot-Curie Supercomputer Used to Build First Full, High-Fidelity Aircraft Engine Simulation

July 14, 2020

When industrial designers plan the design of a new element of a vehicle’s propulsion or exterior, they typically use fluid dynamics to optimize airflow and increase the vehicle’s speed and efficiency. These fluid dyn Read more…

By Oliver Peckham

Graphcore Introduces Next-Gen Intelligence Processing Unit for AI Workloads

July 15, 2020

British hardware designer Graphcore, which emerged from stealth in 2016 to launch its first-generation Intelligence Processing Unit (IPU), has announced its nex Read more…

By Oliver Peckham

heFFTe: Scaling FFT for Exascale

July 15, 2020

Exascale computing aspires to provide breakthrough solutions addressing today’s most critical challenges in scientific discovery, energy assurance, economic c Read more…

By Jack Dongarra and Stanimire Tomov

Get a Grip: Intel Neuromorphic Chip Used to Give Robotics Arm a Sense of Touch

July 15, 2020

Moving neuromorphic technology from the laboratory into practice has proven slow-going. This week, National University of Singapore researchers moved the needle Read more…

By John Russell

Max Planck Society Begins Installation of Liquid-Cooled Supercomputer from Lenovo

July 9, 2020

Lenovo announced today that it is supplying a new high performance computer to the Max Planck Society, one of Germany's premier research organizations. Comprise Read more…

By Tiffany Trader

President’s Council Targets AI, Quantum, STEM; Recommends Spending Growth

July 9, 2020

Last week the President Council of Advisors on Science and Technology (PCAST) met (webinar) to review policy recommendations around three sub-committee reports: Read more…

By John Russell

Google Cloud Debuts 16-GPU Ampere A100 Instances

July 7, 2020

On the heels of the Nvidia’s Ampere A100 GPU launch in May, Google Cloud is announcing alpha availability of the A100 “Accelerator Optimized” VM A2 instance family on Google Compute Engine. The instances are powered by the HGX A100 16-GPU platform, which combines two HGX A100 8-GPU baseboards using... Read more…

By Tiffany Trader

Q&A: HLRS’s Bastian Koller Tackles HPC and Industry in Germany and Europe

July 6, 2020

In this exclusive interview for HPCwire – sadly not face to face – Steve Conway, senior advisor for Hyperion Research, talks with Dr.-Ing Bastian Koller about the state of HPC and its collaboration with Industry in Europe. Koller is a familiar figure in HPC. He is the managing director at High Performance Computing Center Stuttgart (HLRS) and also serves... Read more…

By Steve Conway, Hyperion

OpenPOWER Reboot – New Director, New Silicon Partners, Leveraging Linux Foundation Connections

July 2, 2020

Earlier this week the OpenPOWER Foundation announced the contribution of IBM’s A21 Power processor core design to the open source community. Roughly this time Read more…

By John Russell

Supercomputer Modeling Tests How COVID-19 Spreads in Grocery Stores

April 8, 2020

In the COVID-19 era, many people are treating simple activities like getting gas or groceries with caution as they try to heed social distancing mandates and protect their own health. Still, significant uncertainty surrounds the relative risk of different activities, and conflicting information is prevalent. A team of Finnish researchers set out to address some of these uncertainties by... Read more…

By Oliver Peckham

[email protected] Turns Its Massive Crowdsourced Computer Network Against COVID-19

March 16, 2020

For gamers, fighting against a global crisis is usually pure fantasy – but now, it’s looking more like a reality. As supercomputers around the world spin up Read more…

By Oliver Peckham

[email protected] Rallies a Legion of Computers Against the Coronavirus

March 24, 2020

Last week, we highlighted [email protected], a massive, crowdsourced computer network that has turned its resources against the coronavirus pandemic sweeping the globe – but [email protected] isn’t the only game in town. The internet is buzzing with crowdsourced computing... Read more…

By Oliver Peckham

Supercomputer Simulations Reveal the Fate of the Neanderthals

May 25, 2020

For hundreds of thousands of years, neanderthals roamed the planet, eventually (almost 50,000 years ago) giving way to homo sapiens, which quickly became the do Read more…

By Oliver Peckham

DoE Expands on Role of COVID-19 Supercomputing Consortium

March 25, 2020

After announcing the launch of the COVID-19 High Performance Computing Consortium on Sunday, the Department of Energy yesterday provided more details on its sco Read more…

By John Russell

Neocortex Will Be First-of-Its-Kind 800,000-Core AI Supercomputer

June 9, 2020

Pittsburgh Supercomputing Center (PSC - a joint research organization of Carnegie Mellon University and the University of Pittsburgh) has won a $5 million award Read more…

By Tiffany Trader

Honeywell’s Big Bet on Trapped Ion Quantum Computing

April 7, 2020

Honeywell doesn’t spring to mind when thinking of quantum computing pioneers, but a decade ago the high-tech conglomerate better known for its control systems waded deliberately into the then calmer quantum computing (QC) waters. Fast forward to March when Honeywell announced plans to introduce an ion trap-based quantum computer whose ‘performance’ would... Read more…

By John Russell

10nm, 7nm, 5nm…. Should the Chip Nanometer Metric Be Replaced?

June 1, 2020

The biggest cool factor in server chips is the nanometer. AMD beating Intel to a CPU built on a 7nm process node* – with 5nm and 3nm on the way – has been i Read more…

By Doug Black

Leading Solution Providers

Contributors

Nvidia’s Ampere A100 GPU: Up to 2.5X the HPC, 20X the AI

May 14, 2020

Nvidia's first Ampere-based graphics card, the A100 GPU, packs a whopping 54 billion transistors on 826mm2 of silicon, making it the world's largest seven-nanom Read more…

By Tiffany Trader

‘Billion Molecules Against COVID-19’ Challenge to Launch with Massive Supercomputing Support

April 22, 2020

Around the world, supercomputing centers have spun up and opened their doors for COVID-19 research in what may be the most unified supercomputing effort in hist Read more…

By Oliver Peckham

Australian Researchers Break All-Time Internet Speed Record

May 26, 2020

If you’ve been stuck at home for the last few months, you’ve probably become more attuned to the quality (or lack thereof) of your internet connection. Even Read more…

By Oliver Peckham

15 Slides on Programming Aurora and Exascale Systems

May 7, 2020

Sometime in 2021, Aurora, the first planned U.S. exascale system, is scheduled to be fired up at Argonne National Laboratory. Cray (now HPE) and Intel are the k 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

TACC Supercomputers Run Simulations Illuminating COVID-19, DNA Replication

March 19, 2020

As supercomputers around the world spin up to combat the coronavirus, the Texas Advanced Computing Center (TACC) is announcing results that may help to illumina Read more…

By Staff report

$100B Plan Submitted for Massive Remake and Expansion of NSF

May 27, 2020

Legislation to reshape, expand - and rename - the National Science Foundation has been submitted in both the U.S. House and Senate. The proposal, which seems to Read more…

By John Russell

John Martinis Reportedly Leaves Google Quantum Effort

April 21, 2020

John Martinis, who led Google’s quantum computing effort since establishing its quantum hardware group in 2014, has left Google after being moved into an advi Read more…

By John Russell

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