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Chip-making company LSI Corp. recently signed an original equipment manufacturer (OEM) agreement with the chip-giant Intel Corp. (INTC - Analyst Report). Per the agreement, Intel will use LSI’s Nytro MegaRAID for its redundant array of independent disks (RAID)-based server solutions.

LSI Nytro MegaRAID is a type of PCIe (Peripheral Component Interconnect Express) Flash Adapter that allows servers and storage systems to store frequently-used data in flash memory, thereby enabling faster access and better performance.

LSI’s flash technology reduces latency (input/output processing time) and boosts application performance by converting server-based flash into a high-performance cache for processing critical business applications faster.

Intel will integrate the Nytro MegaRAID technology within its RAID SSD Cache Controllers, RCS25ZB040 and RCS25ZB040LX. The technology will help Intel to provide its server customers with very high levels of random IOPS (Input/Output Operations Per Second) performance for managing databases and Big Data applications, implementing Hadoop (a free, Java-based programming framework that supports the processing of large data sets in a distributed computing environment) and virtual desktop infrastructure (VDI).

Last month, LSI’s Nytro WarpDrive PCIe flash cards were selected by storage solutions provider NetApp Inc. (NTAP - Snapshot Report). The flash card will be used with NetApp’s Flash Accel software.

The non-volatile, shock resistant, high-speed and relatively power efficient nature of flash technology has made it popular as an economic storage solution. Enterprises are opting for flash technology even for their data centers to drive efficiency and lower information technology (IT) maintenance costs. Within flash technology, demand for PCIe-based flash card is gaining traction, mainly because of low latency and better productivity. The growing demand for PCIe-based flash solutions has prompted players such as STEC Inc., Fusion-io Inc., Marvell Technology plc and Seagate Technology plc (STX - Analyst Report) to increase their exposure in this space.

LSI’s position in providing PCIe flash solution seems to be strong given its close associations with NetApp and Intel. The company solidified its position in the PCIe space with the acquisition of SandForce Inc. in Jan 2012. SandForce broadened its product range and provided access to Ultrabook, notebook, enterprise SSD and flash segments.

LSI Corp. delivered decent fourth quarter results with the top and bottom lines exceeding the Zacks Consensus Estimates. The continuing macro uncertainty and dwindling PC market prompted the company to provide a sequentially weak guidance.

Currently, LSI has a Zacks Rank #3 (Hold).

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