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Four-core Opteron box fiasco crushes Cray's 2007

Seeing red over Budapest

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Cray has blamed delayed shipments of Opteron-based servers for a likely massive fall in 2007 revenue.

The supercomputer maker today warned that its midpoint forecast for 2007 revenue has been lowered to $200m from previous guidance last month of $230m. The revenue drop comes as a result of delayed XT4 system shipments and could result in Cray posting a loss for the year. Cray had hoped to get upgraded XT4 systems using AMD's upcoming four-core version of Opteron out the door at a quick clip.

"Due to recent information with respect to the timing of volume parts availability, the company now believes that 2007 revenue associated with quad-core Cray XT4 systems will likely be less than previously anticipated," the company said. "Cray continues to anticipate deliveries of quad-core Cray XT4 systems and upgrades to begin during the fourth quarter of 2007; however, the timing is such that most or all of the planned acceptances, and associated revenue recognition, will likely be deferred until early 2008."

Cray had been enjoying a recent return to profitability. CEO Pete Ungaro noted that he was "disappointed" with the delays that put both growth and profitability "in jeopardy."

A Cray spokesman declined to say which "volume part" in particular was causing the XT4 problems. "We have a handful of sole sourced pieces," he bragged.

So, it remains unclear what Cray's situation implies for the larger four-core Opteron rollout.

We're told that the XT4 boxes rely on the lower-end 1000 Series four-core chips code-named Budapest, which AMD has said will ship in the second half of 2007. The rest of the world is most excited about the higher-end four-core parts dubbed Barcelona, which are set to ship by mid-year.

"Barcelona remains on track for launch this Summer," said an AMD spokesman. "You will see platforms shipping from partners in the third quarter. Budapest is on track for the second half of the year."

Shares of Cray were down more than 10 per cent on the news, at the time of this report. ®

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