The problem is that cost of revenues and SG&A is way way out proportion with sanity. I'd love to hear how they let the expenses get so much out of hand. I am not questioning the rise of R&D which is more than 250% of year ago, even though that too is alarming. After all, they were developing V2 last year so it is not as if R&D did not have its hands full. But being an engineer, and given all the new products in the pipeline, I can live with the R&D costs.
What can win me over, besides a technical break out, is if the management can provide good guidance as to revenues and margins for the year. If I can build a business model that can forecast the results pretty well, then I will consider a heavy investment in TDFX. Until then, it remains a trading stock.
Sun Tzu
P.S. Not to spoil the party or anything, but I've seen 3Dfx report double the expectation and fall to the depths of abyss. Still, it is nice that they made more than expectations. |
