SGI CY2004 Server Sales Jump 20 Percent Growing Three Times Faster Than the Global Server Market

Japan's Institute of Solid State Physics and Stanford Linear Accelerator Center Join Ranks of Users Migrating to Powerful Linux Platforms

MOUNTAIN VIEW, Calif., (March 3, 2005)—Silicon Graphics (NYSE: SGI) today announced that worldwide sales of its servers and supercomputers grew 20 percent year-over-year in calendar 2004. According to IDC's recent Worldwide Quarterly Server Tracker, which pinpoints global server market sales growth at 6.2 percent for the same period, SGI server sales grew more than three times faster than the market.

The company attributes this growth to customers increasingly choosing open standards-based SGI® Altix® systems based on the Linux® operating system and Intel® Itanium® 2 processors.

"We set out to rock the technical compute world with Altix and almost daily we hear how this system has enabled users to exceed their expectations," said Dave Parry, senior vice president and general manager, Server and Platform Group, SGI. "High-performance computing is clearly shifting from closed proprietary models to an open model that offers users a more interactive, versatile solution. This liberation enables them to be far more innovative and productive."

Recently Japan's Institute of Solid State Physics (ISSP) and Stanford Linear Accelerator Center (SLAC) joined the hundreds of demanding researchers and scientists that have turned to the Altix family of servers, clusters and supercomputers for breakthrough results in the most important challenges facing modern industrialized countries. SGI customers rely on Altix to drive new advances in a broad range of vital research, including disease control, comprehensive climate modeling, harnessing new sources of energy, and designing safer and more efficient forms of transportation.

"In discussions with end users we consistently hear from the technical computing community that they need solutions that can address complex problems with increased fidelity, while decreasing simulation turnaround times," said Earl Joseph, research vice president, High-Performance Systems practice, IDC. "SGI's strategy is to develop systems that specifically address these requirements. In particular, by leveraging standard technologies and focusing its resources SGI is able to improve technical applications scope and performance."

Powerful Solutions Based on Industry Standards
Customers are drawn to the Altix platform for three key attributes: its ability to readily support the problem at hand, versatility that lets customers add to rather than replace the system, and performance that consistently leads the industry. These attributes have earned Altix an impressive number of awards, industry-leading performance benchmarks and groundbreaking technology achievements in its first two years including:

• 100 percent year-over-year growth in the most recent quarter ending December 2004
• The 10,240 processor NASA Columbia system - developed in under three months - ranked as the world's second-fastest computer
• More than 600 customer sites and nearly 1400 systems supporting more than 40,000 Intel Itanium 2 processors
• A global shared memory architecture that delivers data across nodes of 6.4GB/sec and lowest latency at 1 microsecond - the industry's fastest
• Consistent record industry-standard benchmarks regularly outpacing competing systems from HP, IBM, Sun and others and dominating the respected STREAM list of the 20 fastest systems in terms of memory bandwidth
• A portfolio of leading high-performance computing applications that have been certified and optimized include:
  • More than 200 leading and commercially available 64-bit applications
  • The wide range of applications running on Itanium 2 processors
  • Leading database applications including IBM® DB2 Universal Database, Oracle® 10g database and Sybase® Adaptive Server® Enterprise

As the Altix platform evolves, SGI plans to drive further growth in four key areas:

• Small- to large-node cluster solutions
• Price/performance improvements with Itanium 2 family
• Industry-standard Linux operating system solutions
• Density and heating/cooling solutions

Additional Altix system technical and availability information is posted on www.sgi.com/products/servers/altix.

Former UNIX Devotees Choosing Linux
IDC also noted in the recent Quarterly Review that Linux sales have grown 35.6% year over year. Many Altix customers are eschewing their earlier allegiance to UNIX® in favor of the price/performance edge that only a system deploying industry-standard components can offer. Scientists and researchers driving this growth with Linux OS-based Altix systems are achieving historic breakthroughs in automotive and consumer product design, energy exploration, global warming research, aerospace analysis and other computing efforts crucial to the health, security, transportation, and quality of life of people around the world.

Users that have chosen the open, industry-standard Altix platform include:

• This month ISSP will replace its existing supercomputing environment made of both vector and scalar systems with a 1,280-processor Altix system. ISSP expects to realize about a 20 times performance improvement over the existing scalar system. The new Altix system will enable ISSP scientists to predict complex solid state phenomena at high accuracy and press on with leading-edge solid state physics.

• SLAC's Kavli Institute for Particle Astrophysics and Cosmology (KIPAC) installed in January a 72-processor Altix 3000 to investigate the birth and death of the very first stars in the universe, in addition to many other diverse astronomical objects and events, such as neutrons stars, galaxy clusters, and galaxy collisions. Hosting a 10TB SGI® InfiniteStorage TP9300 solution and 224GB of global shared-memory the Altix will allow them also to analyze more effectively the large data sets generated by cosmological hydrodynamic simulations.

• At the University of Washington astronomists rely on an SGI Altix system installed July 2004 powered by 24 Itanium 2 processors to model the life of the Milky Way from its inception billions of years ago until today. The university selected Altix over both competing UNIX and Linux systems.

  "One of the advantages of going with Altix over a more Beowulf-type configuration was that the Altix installation was trivial compared to a cluster of PCs," said Tom Quinn, astronomy professor at the University of Washington. "Programming is much easier on Altix, and it fits in nicely with our network of Linux desktop systems, which have migrated from Sun machines and other UNIX."

Other leading worldwide organizations using Altix systems include the Alabama Supercomputing Center, Australian Partnership for Advanced Computing, Bavarian Academy of Sciences and Humanities, BG Exploration & Production India Limited, Centre for Mathematical Modeling and Computer Simulation, Hyundai Motor Company, Japan Atomic Energy Research Institute, National Aeronautic and Space Agency, and National Center for Supercomputing Applications. (See separate announcements: www.sgi.com/company_info/newsroom/.)

SILICON GRAPHICS | The Source of Innovation and Discovery™
SGI, also known as Silicon Graphics, Inc. (NYSE: SGI), is a leader in high-performance computing, visualization and storage. SGI's vision is to provide technology that enables the most significant scientific and creative breakthroughs of the 21st century. Whether it's sharing images to aid in brain surgery, finding oil more efficiently, studying global climate, providing technologies for homeland security and defense or enabling the transition from analog to digital broadcasting, SGI is dedicated to addressing the next class of challenges for scientific, engineering and creative users. With offices worldwide, the company is headquartered in Mountain View, Calif., and can be found on the Web at www.sgi.com.

Silicon Graphics, SGI, Altix, the SGI cube and the SGI logo are registered trademarks, and NUMAlink and The Source of Innovation and Discovery are trademarks of Silicon Graphics, Inc., in the United States and/or other countries worldwide. Intel and Itanium are trademarks or registered trademarks of Intel Corporation or its subsidiaries in the United States and other countries. Linux is a registered trademark of Linus Torvalds in several countries. UNIX is a registered trademark of The Open Group in the U.S. and other countries. IBM and DB2 are trademarks or registered trademarks of International Business Machines Corporation. Oracle is a registered trademark of Oracle Corporation and/or its affiliates. Sybase is a registered trademark and Adaptive Server is a trademark of Sybase, Inc. All other trademarks mentioned herein are the property of their respective owners.

This news release contains forward-looking statements regarding SGI technologies and third-party technologies that are subject to risks and uncertainties. These risks and uncertainties could cause actual results to differ materially from those described in such statements. The viewer is cautioned not to rely unduly on these forward-looking statements, which are not a guarantee of future or current performance. Such risks and uncertainties include long-term program commitments, the performance of third parties, the sustained performance of current and future products, financing risks, the impact of competitive markets, the ability to integrate and support a complex technology solution involving multiple providers and users, the acceptance of applicable technologies by markets and customers, and other risks detailed from time to time in the company's most recent SEC reports, including its reports on Form 10-K and Form 10-Q.