HPE to acquire supercomputer maker Cray in bid to expand High Performance Computing capabilities
In the biggest acquisition since its formation in 2015, Hewlett Packard Enterprise (HPE) is buying supercomputer vendor Cray for $1.3 billion to expand its High Performance Computing (HPC) portfolio and accelerate its growth in artificial intelligence.
The Lowdown: HPE will add Cray’s portfolio of Shasta and Slingshot supercomputers to its existing portfolio of HPC products, including Apollo and SGI, to address the growing need for high-capacity computational systems to support Big Data and artificial intelligence use cases. HPE sees tremendous growth opportunities in use cases including advanced weather forecasting, medical research, cybersecurity, and military modeling.
According to HPE, the HPC market segment will grow from $28 billion in 2018 to $35 billion in 2021. Exascale computing systems, which can process a billion billion calculations per second, will become a $4 billion market opportunity within the next five years.
The Details: Cray’s products, which include Big Data and artificial intelligence software, will join HPE’s existing HPC products. HPE says the addition of Cray will give it the resources to address the growing demand for HPC products as a service through the GreenLake program, a greater ability to capitalize on the growing demand for exascale computing products, and advanced capabilities for developing artificial intelligence and machine learning systems. The acquisition is contingent upon regulatory review and approval. HPE believes the deal will close in early 2020.
The Impact: HPE has a significant presence in the HPC segment. Folding in Cray will give HPE an end-to-end computing portfolio that includes x86 servers, storage, networking equipment, and supercomputers. Additionally, the deal will give HPE a big lift against competitors such as IBM, Fujitsu, Bull, NUDT, and Hitachi.
Background: Cray is a storied company that produced some of the first supercomputers in the world, including systems that processed nuclear weapons and energy simulations. The Seattle-based company generated $456 million in sales in 2018 and employs more than 1,300 people worldwide. Cray is a specialist that operates in a niche, but is not a stranger to the IT channel. Its partner program includes solution providers such as Sirius, World Wide Technology, Datacore, Alliance Technology Group, Altair, and Xoriant. In an existing technology partnership, HPE provides Cray with storage equipment for its HPC systems.
The Buzz: “This is an amazing opportunity to bring together Cray’s leading-edge technology and HPE’s wide reach and deep product portfolio, providing customers of all sizes with integrated solutions and unique supercomputing technology to address the full spectrum of their data-intensive needs,” said Cray CEO Peter Ungaro. “HPE and Cray share a commitment to customer-centric innovation and a vision to create the global leader for the future of high-performance computing and AI. On behalf of the Cray board of directors, we are pleased to have reached an agreement that we believe maximizes value and are excited for the opportunities that this unique combination will create for both our employees and our customers.”
“Answers to some of society’s most pressing challenges are buried in massive amounts of data. Only by processing and analyzing this data will we be able to unlock the answers to critical challenges across medicine, climate change, space, and more,” said HPE CEO Antonio Neri. “Cray is a global technology leader in supercomputing and shares our deep commitment to innovation. By combining our world-class teams and technology, we will have the opportunity to drive the next generation of high-performance computing and play an important part in advancing the way people live and work.”