3DFX Message Board - Msg: 5749341

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Technology Stocks : 3DFX

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To: Joe C. who wrote (7160)	9/14/1998 11:37:00 PM
From: Joe C.	Read Replies (2) of 16960

O.K. Now for a little math: Let's take a stab at revenues given what is known "lose several million dollars" - man I hate this nonsense: Last qtr operating expense was 16.3 (includes R&D and selling). Let's assume these new ad boys brings the bill up to 18. Last qtr. profit margin was 48%. Using this margin, revenues would need to be 37.5 million (18/.48) to break even (compared to revenues of 58.6 million last qtr.) - They've stated that they would drop prices by about 5% so let's say 3rd qtr. margin will be about 45%. Using 45%, revenues would need to be about 40 million to break even. Any way you look at it, this means a fairly significant drop in sales. I'm comfortable with the 18 in operating expenses and doubt it would be much higher. They've probably held their margins and will come in between .45 to .48. Of course this is all guess work given the lousy press release. Weather forecast for NYC is rain - can't stay in, can't go out, can't seem to get a break. Joe C. P.S. FWIW I'm not selling at these prices but I don't know how long I'll stay in when and if it turns around. I might have to do a little tax loss selling :(

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