Survival of Cray's spinoff will depend on creativity and longevity of designer

Article Abstract:

Cray Research Inc will withdraw $100 million in financing it provided for its Cray Computer Corp spinoff if Seymour Cray leaves or if the Cray 3 supercomputer development project is scrapped. The Cray-3 is in its sixth year of development already and reportedly requires at least another year and $120 million more to complete. The project is a risky one: not only is Cray's age, 64, a worry, but the Cray 3's gallium arsenide chip technology is unproven and delicate. When the supercomputer does become available, the potential market consists of about 100 customers, and competition is expected to be fierce. IBM Hitachi, NEC Corp and Fujitsu will all offer machines to compete with the Cray 3, but the biggest competitor may be Cray Research, which has about 60 percent of the supercomputer market. Cray Research will unveil its C-90 machine in 1991.

Management, Product development, Investments, Spinoffs (Corporate), Financial Report, Spinoff Company, Cray Computer Corp., Cray, Seymour R., Cray Computer Cray-3 (Supercomputer)

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Cray Research says it plans to lay off 400

Article Abstract:

Cray Research Inc cites slow demand for its supercomputers and announces the first layoff in the company's 17-year history. Cray will reduce its work force by about 400, which is 7 percent of overall employment and about 18 percent of manufacturing personnel. Cray's president, Marcello Gumucio, says the company expects a difficult year and must move to control costs. For one thing, the government accounts for about half of Cray's business, and supercomputers are likely to be major components of Star War systems. But Gumucio notes that government contract orders are taking longer than anticipated, requiring orders to be bumped back. Pres Gumucio also says that his company will decide by the end of 1989 whether to build a small supercomputer to compete with machines made by other companies, such as Convex Computer Corp.

Human resource management, Beliefs, opinions and attitudes, Layoffs, Layoff, Cost control, Demand, Cost Reduction, Gumucio, Marcello

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Cray says sales of computers to be flat in '90; report is latest in string of bad news for firm; third-period net rose

Article Abstract:

Cray Research Inc expects a no-growth year in 1990, but the company announces improved net income for the 3rd qtr. Cray earned $30.6 million ($1.04 a share), up 35 percent from $22.6 million (73 cents a share) in 1988. Revenue gained 45 percent, rising from $425.4 million to $454.6 million. Cray's stock closed down $1.125 at $34.25 on the New York Stock Exchange on Tue, Oct 24, 1989. According to one industry analyst, Cray needs a low-end supercomputer to compete with offerings from companies such as Convex Computer Corp and IBM.

Finance, Profits, Statistics, Revenue, Third Quarter, Profit

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