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Cray Lands $97 Million Contract to Upgrade Supercomputer at Oak Ridge National Laboratory

SEATTLE, WA, Oct 11, 2011 -- Global supercomputer leader Cray Inc. (NASDAQ: CRAY) today announced the Company has signed a contract to upgrade the Cray XT5 supercomputer nicknamed "Jaguar" located at the Department of Energy's (DOE) Oak Ridge National Laboratory (ORNL) to a new Cray XK6 supercomputer, which will be nicknamed "Titan." When completed, the Titan system will have a peak performance between 10 and 20 petaflops (quadrillion mathematical calculations per second) of high performance computing (HPC) power.

With a groundbreaking combination of efficiency and scalability, the Titan system at ORNL will bring together the features of a proven, production petascale architecture with innovative NVIDIA(R) (NASDAQ: NVDA) Tesla(TM) graphic processing unit (GPU) technologies to create a supercomputer capable of unprecedented scale. This Cray XK6 system will feature productive, high performance software that leverages a proven, scalable system interconnect and a powerful blend of GPUs and general purpose central processors (CPUs) in a single, tightly integrated supercomputer. As a result, scientists and engineers at ORNL will be able to apply the resources of one the world's most powerful supercomputers to solving some of today's most pressing energy and environmental challenges.

"ORNL and Cray have been working together to optimize the Cray XK6 hardware and software architecture for several years. The result of this collaboration is a system specifically developed for scientific applications," said Jeff Nichols, Associate Laboratory Director for Computing and Computational Sciences at Oak Ridge National Laboratory. "In addition to efficiency and speed, the Cray programming environment allows researchers to continue using Fortran, C, and C++ languages to program the new accelerators."

Signing the contract to transform Jaguar into Titan marks a continuation of an ongoing, collaborative partnership between Cray and ORNL that has resulted in a number of significant supercomputing accomplishments. In 2008, Jaguar set a world record for computer speed with sustained performance of more than a petaflops on two scientific applications, and has subsequently run five applications above that threshold. Cray and ORNL look to continue this trend as the lab's system evolves from a Cray XT5 machine to the new Cray XK6 supercomputer.

"Oak Ridge, the Department of Energy's Office of Science, and Cray have a history of accomplishing great things by continually pushing the boundaries of supercomputing," said Peter Ungaro, president and CEO of Cray. "Signing this contract is a significant milestone for our company and our partnership with Oak Ridge because the new system will enable even further amazing scientific achievements. When we announced the Cray XK6 a few months ago, we said it had an architecture capable of scaling to more than 50 petaflops, and Titan will be a major step toward achieving that goal."

Consisting of products and services, the multi-year, multi-phase contract is valued at more than $97 million. The first phase of the contract will include replacing the Cray XT5 compute blades with Cray XK6 compute blades, which will feature the upcoming AMD (NYSE: AMD) Opteron(TM) processors code-named "Interlagos," Cray's Gemini interconnect, and a subset of Cray XK6 nodes equipped with NVIDIA Tesla 20-series GPUs. The first phase is expected to generate more than $60 million in product revenue and is targeted to be completed in 2011. The second phase of the contract -- equipping the system with NVIDIA Tesla GPUs based on the next-generation architecture code-named "Kepler" -- is expected to be completed in the second half of 2012. The contract includes additional upgrade options beyond these two phases that, if exercised, would increase the total value of the contract.

The company had previously disclosed the first phase of the agreement as the order not yet secured that was anticipated to be more than $60 million in potential 2011 revenue. Shipments of the AMD "Interlagos" processors to be used for this system began later than originally anticipated. Although the impact of this delay is uncertain, the Company currently continues to target achieving acceptance of the initial phase of the contract in late 2011.

About the Cray XK6 Supercomputer

Launched in May of this year, the Cray XK6 system is a hybrid supercomputer that integrates Cray's Gemini interconnect, AMD Opteron processors code-named "Interlagos," and NVIDIA Tesla 20-Series GPUs. The unified CPU/GPU programming environment provides Cray XK6 users with tested tools, libraries, compilers and third-party software that is fully integrated with the system's hardware. By combining AMD Opteron processors with NVIDIA GPUs, Cray XK6 customers can run applications with either scalar or accelerator components, resulting in one of the first general-purpose GPU supercomputers that is capable of more than 50 petaflops of performance.

About Cray Inc.

As a global leader in supercomputing, Cray provides highly advanced supercomputers and world-class services and support to government, industry and academia. Cray technology is designed to enable scientists and engineers to achieve remarkable breakthroughs by accelerating performance, improving efficiency and extending the capabilities of their most demanding applications. Cray's Adaptive Supercomputing vision is focused on delivering innovative next-generation products that integrate diverse processing technologies into a unified architecture, allowing customers to surpass today's limitations and meeting the market's continued demand for realized performance. Go to www.cray.com for more information.

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 and Section 27A of the Securities Act of 1933, including, but not limited to, statements related to Cray's ability to deliver the XK6 system upgrades to ORNL when expected, Cray's ability to deliver the XK6 upgrades that meet ORNL's needs, the expected ultimate value of the contract and the expected amount and timing of Cray revenue contribution from the contract. These statements involve current expectations, forecasts of future events and other statements that are not historical facts. Inaccurate assumptions and known and unknown risks and uncertainties can affect the accuracy of forward-looking statements and cause actual results to differ materially from those anticipated by these forward-looking statements. Factors that could affect actual future events or results include, but are not limited to, the risk that the XK6 system upgrades required by ORNL are not delivered in a timely fashion or do not perform as expected, the risk that the AMD "Interlagos" processor, shipments of which began later than originally anticipated, is not available to Cray in the quantities necessary when needed, the risk that certain planned U.S. government funding for ORNL becomes unavailable before the lease-to-purchase contract is converted to a purchase contract through third-party lease financing and as a result Cray is not able to collect amounts expected under the contract or complete the second phase of the contract, the risk that NVIDIA's next-generation "Kepler" GPUs are not available with the performance expected or when expected, and such other risks as are identified in the Company's quarterly report on Form 10-Q for the quarter ended June 30 2011, and from time to time in other reports filed by Cray with the U.S. Securities and Exchange Commission. You should not rely unduly on these forward-looking statements, which apply only as of the date of this release. Cray undertakes no duty to publicly announce or report revisions to these statements as new information becomes available that may change the Company's expectations.

Cray is a registered trademark of Cray Inc. in the United States and other countries, and Cray XT5, Cray XK6 and Gemini are trademarks of Cray Inc. Other product and service names mentioned herein are the trademarks of their respective owners.

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