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Supercomputer maker Cray warns on outlook and misses Street's 4Q earnings estimate

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The supercomputer maker Cray Inc fell short of Wall Street’s earnings in the fourth quarter and said it would report a “substantial” non-GAAP net loss for 2019.

The news didn’t sit well with investors who sent Cray shares down by 6.6% in after-hours trading to $20.60.

In a statement, CEO Peter Ungaro forecast that 2019 would be a “transition year” as the company begins to ship its next-generation Shasta supercomputing platform later this year.

Shasta is billed as Cray’s attempt to bring about the “next era” of supercomputing. In a coup for the company, the National Energy Research Scientific Computing Center, recently bought a Shasta supercomputer in a $146 million contract.

READ: Cray shares rise as it lands US$36mln contract for severe weather system

“Shasta will deliver a balance of performance, flexibility and ease of use unlike anything available today, as well as a true exascale-class architecture capable of scaling well into the future,” Ungaro said in a statement.

For the three months until the close of December 31, the Seattle company posted a non-GAAP net loss of $9 million, or $0.22 per share, compared to net income of $9 million, or $0.22 per share in the fourth quarter of 2017. The results fell short of the expectations of analysts who had forecast that Cray would see a loss of $0.02 per share.

Its revenue in the fourth quarter came in at $163 million, down from $167 million in the fourth quarter of 2017, but ahead of analysts’ estimates of $158 million.

Looking ahead to 2019, Cray expects revenue to grow modestly compared to 2018, with gross margins set to be in the 30% range and operating expenses likely to grow. “Based on this outlook, the company expects to recognize a substantial GAAP and non-GAAP net loss for 2019,” Cray said in a statement.

Its net loss for 2018 was $72 million compared to a net loss of $134 million in 2017. Its revenue last year, meanwhile, came in at $456 million, compared to $393 million in 2017.

In business for more than 45 years, Cray develops some of the world’s most advanced supercomputers.

Contact Ellen Kelleher at [email protected]

Story by ProactiveInvestors


Source: https://www.proactiveinvestors.com/companies/news/214491/supercomputer-maker-cray-warns-on-outlook-and-misses-street-s-4q-earnings-estimate-214491.html


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