Supercomputer manufacturer Cray, Inc. (CRAY) proved to be the strongest contributor to portfolio performance, gaining 35.91% for the period due in large part to the strength of its management. We believe much of the credit for the firm’s success should go to Chief Executive Officer Peter Ungoro and the team he has built since leaving IBM. He has positioned the company within its traditional supercomputer business with an internally-developed adaptive computing technology that gives Cray computers the flexibility to offer CPU (Central Processing Unit) and GPU (Graphical Processing Unit) from several chip manufacturers rather than being tied to just one. As a result, Cray can use the best technology available as well as allow customers to later upgrade or reconfigure their systems if they choose. In addition, while traditionally focused on Government contracts, Mr. Ungoro has positioned the firm to grow within the emerging field of Big Data and expand its base of commercial customers. Commercial revenue accounted for just 20% of total revenue in 2012. The company’s new offerings in Big Data should create significant room to grow that segment of its business over the next several years.
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