RETAIL

Silicon Graphics today announced results for its fourth fiscal quarter and fiscal year ended June 25, 2004. Revenue from continuing operations (excluding the Alias software business) was $208 million for the fourth quarter. The operating loss from continuing operations in the fourth quarter was $7 million or $0.03 per share. For total operations, including the gain on the sale of the Alias business in June 2004, SGI reported net income for the fourth quarter of $44 million or $0.17 per share. Revenue from continuing operations for fiscal 2004 was $842 million, as compared to $897 million for the prior fiscal year. The operating loss from continuing operations was $65 million for the fiscal year, including $48 million of restructuring charges, as compared to a loss from continuing operations of $137 million for the prior fiscal year, including $30 million of restructuring charges. On a year over year basis, the company's non-GAAP operating performance excluding restructuring charges improved by $101 million from a loss of $118 million to a loss of $17 million. "SGI showed significant progress in FY04; improving its balance sheet, tightening its operations, attracting new customers and introducing ground-breaking technology," said Bob Bishop, Chairman and CEO. "Our customers see tangible value in SGI's unique system architecture and singular focus on technical computing. They are working closely with us to solve the greatest scientific challenges of the 21st Century, as evidenced by the selection of the Altix platform for supercomputing deployments at NCSA, NASA and other government agencies." In June 2004, SGI completed the sale of its Alias software business unit for a purchase price of $57.5 million. As a result, SGI's financial results for the fourth quarter and all prior periods exclude Alias as it is a discontinued operation. The sale of Alias in the fourth quarter yielded a significant improvement in net working capital and an after tax net gain from discontinued operations of $51 million or $0.20 per share. For purposes of sequential comparison, SGI's financial results from continuing operations for the third quarter of fiscal 2004 were revenue of $213 million, gross margin of 42.1% and an operating loss of $9 million. As of June 25, 2004, unrestricted cash, cash equivalents and marketable investments were $157 million compared with $141 million at March 26, 2004. SGI will conduct a conference call today at 2 p.m. PT to provide additional details. The webcast is available at http://www.sgi.com/company_info/investors/events.html . The dial-in number is 888-208-1824 or 913-981-4900 for participants outside North America. An audio replay of this call will be available after 5 p.m. PT today at 888-203-1112 (passcode: 293337) or 719-457-0820 (passcode: 293337) and will be available for seven days. All links to the archived Webcast and audio replay are available through SGI's Web site at www.sgi.com/company_info/investors/ .