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Cray Signs $200 Million Contract to Deliver World's Largest Supercomputer to Oak Ridge

SEATTLE, WA, June 15, 2006 - Cray Inc. (Nasdaq NM: CRAYD) announced today that they have signed a multi-year contract with the U.S. Department of Energy's (DOE) Oak Ridge National Laboratory (ORNL) to provide the world's first petaflops-speed (1,000 trillion floating-point operations per second) supercomputer.

The total contract, including systems and services, is valued at about $200 million and calls for progressive upgrades to ORNL's existing Cray XT3™ supercomputer. This system will be upgraded to dual-core processors later this year, accelerating peak speed from 25 teraflops (25 trillion calculations per second) to 50 teraflops. Further upgrades will increase the performance to 100 teraflops, planned in late 2006, and to 250 teraflops, planned in late 2007.

ORNL is then expected to install a next-generation Cray supercomputer in late 2008. This system, currently code-named 'Baker,' is designed to deliver peak performance of one petaflops, making it roughly three times faster than any existing computer in the world. All systems provided for in this contract will utilize current and future versions of the AMDTM Opteron processor.

"ORNL has had a long and rewarding partnership with Cray that has enabled us to accomplish breakthrough science," said ORNL Director Jeff Wadsworth. "The Department of Energy's Leadership Computing Facility at ORNL will help ensure that the United States remains a world leader by helping solve 'grand challenge' problems in nanoscience, biology and energy technologies."

"Without a doubt, this is a great day for Cray," said Cray president and CEO Peter Ungaro. "Cray supercomputers were first to achieve gigaflops sustained performance in 1989, and first to break the sustained teraflops barrier in 1998. Now ORNL and Cray are not only well on the way to breaking the petaflops barrier, we are also working together to realize Cray's Adaptive Supercomputing vision by making this immense processing power available for real-world scientific and engineering applications."

Staff and guest researchers at ORNL use Cray supercomputers to explore the frontiers of neutron science, biological systems, energy production and advanced materials. In addition, scientists and industry partners such as The Boeing Company, DreamWorks Animation SKG, Harvard University and the California Institute of Technology will be able to employ the enhanced Cray supercomputer configuration to conduct high-impact projects as part of DOE's INCITE program.

Investor Considerations
Cray expects to begin recognizing product revenue on the ORNL installation in the second half of 2006, with approximately one third of the revenue to be recognized over the next two years and the remainder expected to be recognized thereafter. The total approximate value of the contract is contingent upon Cray meeting certain delivery dates.

The ORNL contract was considered in Cray's prior revenue guidance for 2006, most recently updated on June 7, 2006. The size of the deliverables scheduled in late 2006 will influence total annual revenue and could modestly affect the range of outcomes for the year. The timing of revenue recognition on these deliverables could affect 2006 and 2007 by as much as $30 million.

About Oak Ridge National Laboratory
Located in Oak Ridge, Tennessee, ORNL is the U.S. Department of Energy's largest science and energy laboratory, with over 4,000 researchers and support staff. ORNL is an international leader in research areas that include neutron science, new energy sources, high-performance computing, biological systems, nanoscale materials science and national security. ORNL is home to the Center for Functional Genomics, the Center for Nanophase Materials Sciences and a number of other research facilities. The laboratory was selected as the site of the Office of Science's National Leadership Computing Facility, whose goal is to build the world's fastest supercomputer for unclassified research. Go to for more information

About the Cray XT3 Supercomputer
The Cray XT3 supercomputer is the third-generation MPP system from Cray. Purpose-built to deliver exceptional sustained application performance for challenging scientific and engineering problems, the Cray XT3 system has set new performance records for systems equipped with standard-based processors. The supercomputer's high-speed 3D torus interconnect, advanced MPP operating system and high-speed global input/output make it possible for users to scale applications from 200 to more than 30,000 processors without performance loss. The system's scalable processing element uses x86 64-bit AMD Opteron single or dual-core processors that employ HyperTransport™ technology to increase bandwidth and reduce latency. The Cray XT3 supercomputer was named 2005 Product of the Year by Scientific Computing & Instrumentation. Go to for more information.

About Cray Inc.
As the global leader in supercomputing, Cray provides highly advanced supercomputing systems and world-class services and support to government, industry and academia. Cray technology enables 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 will result in 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. For more information, go to

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 amount and timing of revenue, technical challenges of developing high-performance computing systems including potential delays in development projects, Cray's ability to meet contracted delivery milestones and dates, timing and level of government support for supercomputer purchases and research and development activities, reliance on third-party suppliers including delays in availability of parts from suppliers, timing of and successful porting of application programs to new computing systems and successful passing of customer acceptance tests. 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.

Cray is a registered trademark, and Cray XT3 is a trademark, of Cray Inc. Opteron is a trademark of Advanced Micro Devices, Inc. HyperTransport is a licensed trademark of the HyperTransport Technology Consortium. All other trademarks are the property of their respective owners.

Melissa Power

Vic Chynoweth