Actually, the Oppenheimer analyst, according to what he actually wrote as comments in his report, isn't so much thinking the competition is going to reduce the sales of 3dfx in Q3/Q4 but simply believing that by then 3dfx will pretty much have sold a board to everyone that wants one, hence saturating the market.
Remember when IBM predicted the total mkt for computers to be about 12 mainframes? and when DEC's Ken Olson made the same kind of off the mark assumptions re PCs. What is amazing is that given his initial earnings prediction, 3dfx has in this quarter alone sold more chips than he originally thought the entire market over the full year could consume. Yet, undeterred, he keeps the same view, only changing the numbers.
This indicates one of three things:
1. He's clueless about the market, the end-users, the products and 3dfx position in the competitive landscape; 2. He holds a grudge against 3dfx or its management, for whatever reason (maybe for not getting a banking deal, or simply because he was made feel he was clueless); or 3. both 1 & 2.
Like in every profession, there are some truly exceptional people on Wall Street, and a lot of others...
The 3D mkt has been tough for the Street to understand and perceive as something else than a niche. I should know, having been in it the last 8 years, and selling my former company, Ray Dream, against most people's expectations for over $ 50 million. Of course, the fact that we managed to sell well hundreds of thousands of products where people thought the entire market would buy in the tens of thousands of units did help. |
