Cray Research Inc has hit problems – thought to be associated with the Gallium Arsenide chips – on the upcoming Cray-3, and as a result has reported a 37% fall in third quarter profits to $22.6m, 73 cents a share on sales down 21% at $145.2m. The company says the Cray-3 snag is likely to cost it an extra $10m this year, and that profits will therefore be up only 5% to 7% compared with 1987, against analysts’ forecasts of 10%. It now expects to lease more machines and sell fewer in 1989, and as a result, it is likely to grow turnover only 10% and is budgeting accordingly. Some observers fear that the problem on the Cray-3, which is due out late in 1989, may also delay the launch.
