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Penguin sends in a ray of financial sunshine

Penguin Computing CEO and all around good guy Charlie Wuischpard (yes, I can pronounce his last name, thank you very much) wanted to allay my depression after reporting on quarterly results for Cray and SGI yesterday

Not to trumpet our results here (ok, maybe a little) but after reading the Cray and SGI results yesterday, it might be worth noting that Penguin increased revenues over 300% from Q1 2009 and 35% over Q4 (our prior record quarter over the 11 year history of the company). And profitable! Though in fairness, we are smaller than these fellows and take less risk while the industry is still brutal when it comes to terms and conditions, pricing, and the level of expertise required to win.

Charlie also offered a metric to help when assessing the health of companies in our industry

One metric you may want to measure within the normal range of margin is that companies in our industry need to try for the magic $1M revenue/employee per year. $500K at good margin is absolutely a requirement and even a lot of the normal players don’t achieve this.

So I took her out for a test drive using the past two quarters for Cray and SGI . Cray’s revenue per employee* was $33,000 and $101,000 for the quarters ending Mar ’10 and Dec ’09, respectively, while SGI’s was $83,000 and $72,000. Those numbers annualize (multiply by four) to $130k and $404k for Cray, and $332k and $290k for SGI. They are all a looooong way from Charlie’s magic numbers.

*Note that for Cray I determined the number of employees for the end of 2009 (872) from the annual report and held it constant through the first quarter of this year. For SGI I used 1,300 based on the text of this quarter’s filing and carried it back to the end of 2009.

Comments

  1. Interesting – a couple more rough data points
    IBM in FY 2009 had $100B in revenue and 400K employees – that translates to only $250K/employee
    Dell had $61B revenue and 76K employees – $888K/employees

    Is anyone at that $M mark?

    Most HPC hardware players will probably fall somewhere in between IBM and Dell. All depends on their margins.

  2. John West says:

    Jill – thanks for doing the homework on IBM and Dell. It definitely looks like that might be a high bar for hardware makers. I tried to do Appro and Atipa, but it looks like they are private. Bull is European and not required to report information in the same way as our other companies (although the data may be there, I just didn’t find it). I looked at HPQ for 2009, and they were at $375k/EE.

  3. seriously says:

    Penguin are you seriously excited about 1 quarter of profitability? Pretty sad.

  4. my understanding is that Penguin has been profitable more often than not over the last 2 years which in HPC land is not so easy these days.

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