Cray Inc. announced the reinvention of the workstation for the next era of technical computing with the launch of the Cray CX1-iWS(TM) system, which combines a powerful Microsoft Windows 7 workstation with a fully integrated high-performance computing (HPC) cluster running Microsoft Windows HPC Server 2008. With a list price beginning at under $40,000 and sold exclusively through Dell, the Cray CX1-iWS product meets a market need for a new generation of workstation. The Cray CX1-iWS system the 'iWS' stands for 'integrated workstation' combines the interactivity of a workstation with the scale-out performance of a cluster conveniently packaged in a deskside form factor. Users can enjoy a highly responsive and interactive workstation environment (with eight cores of Intel(R) Xeon(R) processors) while initiating distributed jobs leveraging the integrated cluster resource with an additional 24 cores of Intel Xeon processing power. In total, 32 cores are available to the user or workgroup. The Cray CX1-iWS product aims to substantially boost productivity for engineers, scientists and researchers continually challenged with complex problems and little time to solve them.

Cray Inc. reported unaudited consolidated earnings results for the third quarter and nine months ended September 30, 2009. Revenue for the quarter was $58.6 million compared to $54.6 million in the prior year period, an increase of 7%. The company reported a net loss for the quarter of $2.1 million or $0.06 per diluted share compared to net income of $3.6 million or $0.11 per share in the third quarter of 2008. The company reported loss from operations of $4.152 million and loss before income taxes of $3.201 million compared to the income from operations of $5.691 million and income before income taxes of $3.496 million for the same period a year ago. For the nine month period ended September 30, 2009, Cray reported total revenue of $195.8 million compared to $127.5 million in the prior year period, an increase of 54%. Net loss was $3.6 million or $0.11 per diluted share for the nine months ended September 30, 2009 compared to a net loss of 14.8 million or $0.45 per diluted share for the nine month period ended September 30, 2008. The 2009 year-to-date net income results include $4.6 million of stock compensation and $1.7 million of non-cash items related to recent changes in accounting guidelines applicable to convertible notes. The company reported loss from operations of $3.128 million and loss before income taxes of $4.552 million compared to the income from operations of $11.463 million and income before income taxes of $14.484 million for the same period a year ago. For 2009, Cray now expects revenue in the range of $285 million, including about $90 million in service revenue. Overall gross profit margin for the year is expected to be approximately 36%. Operating expenses for 2009, assuming completion of a co-funded development milestone in the fourth quarter, are anticipated to be in the range of $98 million. Based on achieving this outlook, The company anticipate a modest operating income for 2009. Results for the year include approximately $6 million of stock-based compensation. For 2010, Cray expects its revenue to continue to grow, perhaps modestly, and expects to be profitable. Revenue is expected to be heavily weighted to late in the year, driven by the timing of new product introductions.

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