Neither 3dfx, nor anyone else, can give earnings estimates for next year.
Have you looked at Zacks or First Call? Apparently some people have already done just that. These numbers are typically given through guidance by the company. I'll ask the same question again: If guidance is for little more than this year, why are they spending so much money?
It's a whole new game with the OEM market.
No, it isn't. Nvidia has had great success in the OEM market and got only 38M in revenue last quarter. The retail market will decline in a large way once all the second generation cards start shipping on the new computers. It will no longer be necessary to purchase a separate additional 3d card in order to accelerate games.
If 3dfx didn't spend its money on R&D, I would dump this stock in 5 mins, and never look back.
Money does not equal a great product. S3 has had the Savage3d under development for a long time (several years), spending twice as much as 3dfx and has produced, IMHO, a mediocre product. The only reason the product is in the same ballpark as the other nextgen cards is because they used the .25u process. R&D is great but needs to produce tangible results.
The future of 3dfx is in the evolution of its products and future
returns,not in making a quick buck this year.
"Making a buck", quick or not, should be the objective of the company. This includes careful expense management.
All that said, I do believe there are times when a company should run a deficit to gain market share (ala AOL). Since the company has been so hush hush about their future plans I can't approve of such an approach. I will no longer base my investment decisions on the "hope" that 3dfx is doing the right thing. In this I agree with Sun.
Pat
P.S. As you can tell I'm a little ticked off and not quite up to trusting management with my money. The misinformation about the recent state of the company from management has me more than a little wary of the management's honesty/competence. |
