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July 25, 1997updated 05 Sep 2016 12:07pm

STRATUS TO HARMONIZE ON MERCED LINE; SPIN-OUT SOFTWARE?

By CBR Staff Writer

Enjoying something of a renaissance following its $167m second quarter, fault tolerant system supplier Stratus Computer Corp will bring its Continuum PA-RISC and Radio Cluster NT Intel-based systems into single line using the Hewlett-Packard/Intel Merced chip. The line, currently known as Harmony, won’t appear until sometime after Intel gets Merced out of the door, which is currently anyone’s guess between the end of next year and the year 2000 (CI No 3,206). Marlborough, Massachusetts-based Stratus is also thinking about spinning off its Isis Distributed Systems and S2 software subsidiaries bought earlier in the decade when it was searching for ways to grow beyond its proprietary VOS operating systems business. It says they’ve been turned around from the rather parlous state they were in and contributed three cents to the bottom line in its $0.71, $17.4m second quarter just gone. Price will be the key metric, now profitability and growth have been nailed. Stratus says it’ll upgrade its Continuum servers to HP’s 64-bit PA-8000 later in the year and will move its Radio NT clusters to Pentium Pro in the second half. It’s currently doing 45% of revenue on sales of PA-RISC systems running its VOS operating system, 48% on sales of its FTX Unix systems and s small amount on Radio, which will never be a big revenue earner, it says. It’s just got HP-UX up on Continuums. It shipped 300 systems last quarter. It’s new partner NEC Corp is contributing significantly to sales. That Stratus has PA-RISC- and Intel-based systems and that HP and Intel are merging their architectures is the kind of luck Stratus says is what it needs. The company made a disastrous chip-change from Motorola 680×0 to Intel i860 RISC in 1992, which Intel abandoned, and had to port its software again, this time to PA-RISC. Stratus acquired Isis for $24m in 1993. S2 is the combination of its Dallas, Texas- based Shared Systems Corp and Atlanta, Georgia-based SoftCom Systems Inc acquisitions which is headquartered in Dallas and had some pretty ambitious revenue forecasts for 1997 (CI No 2,934). Stratus says it sees less competition from one-time main rival Tandem Computers Inc than it used to, arguing Tandem is all but out of this Unix business, claiming Sun, IBM and HP are its main rivals in the key telecommunications market these days. It gets 48% of revenue from the telcos. Stratus does some joint sales and marketing with HP in Germany and Switzerland. Stratus reported second quarter net income of $17.4m up 291% on $4.5m last time which included a charge of $4.6m, on revenue up 19% at $167.6m on $140.3m last time.

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