SOURCE: Cray Inc.

May 24, 2005 07:00 ET

Cray Inc. Signs $17.0 Million Co-funded Development Agreement

SEATTLE, WA -- (MARKET WIRE) -- May 24, 2005 -- Global supercomputer leader Cray Inc. (NASDAQ: CRAYE) today announced that it has signed an agreement with the U.S. Government to continue the development of next-generation supercomputer technologies. The agreement calls for Cray and the Government to each invest approximately $17.0 million over the next two years.

"This new contract extends the important partnership between Cray and the Government. It reflects our mutual, ongoing commitment to developing the next-generation system we have code-named Black Widow, and to U.S. supercomputing leadership," said Jim Rottsolk, Cray chairman and chief executive officer. "The objective of this program is to produce supercomputer technologies that support superior memory bandwidth performance, stride independent memory bandwidth, instruction level parallelism and power efficiency.

"The development of these systems advances our product roadmap," Rottsolk added. "With continued funding, we expect Black Widow to reach a peak performance of several hundred teraflops in its initial design, and to exceed a petaflops (a thousand trillion calculations per second) in its product lifetime.

"We are very gratified for the strong support of Congressmen David Obey, Martin Olav Sabo and Norm Dicks in furthering this key public-private partnership," he said.

About Cray Inc.

As the global leader in high-performance computing (HPC), Cray provides innovative supercomputing systems that enable scientists and engineers in government, industry and academia to meet both existing and future computational challenges. Building on years of experience in designing, developing, marketing and servicing the world's most advanced supercomputers, Cray offers a comprehensive portfolio of HPC systems that deliver unrivaled sustained performance on a wide range of applications. Go to www.cray.com for more information.

Safe Harbor Statement

This press release contains forward-looking statements. There are certain factors that could cause Cray's execution plans to differ materially from those anticipated by the statements above. These include the technical challenges of developing high-performance computing systems, government support and timing of supercomputer system purchases, the successful porting of application programs to Cray computer systems, reliance on third-party suppliers, fluctuating quarterly operating results, lower margins and earnings due to significant pricing pressure, Cray's ability to keep up with rapid technological change, Cray's ability to compete against larger, more established companies and innovative competitors, and general economic and market conditions. For a discussion of these and other risks, see "Factors That Could Affect Future Results" in Cray's most recent Quarterly Report on Form 10-Q filed with the SEC.

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