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Technology Stocks : ATI Technologies in 1997 (T.ATY) -- Ignore unavailable to you. Want to Upgrade?

To: Robert who wrote (5548)	5/25/2000 9:47:00 PM
From: OrionX	Read Replies (2) \| Respond to of 5927

Robert, You said This company has fundamental problems: Loss of market share Competitors like Intel and Nvidia Shrinking margins Flat to shrinking revenue growth Negative earnings I thought about ignoring your comments and what point you're trying to make but then I figured, I can't let you post negative and false information unless you can back those statements up. So where are you getting your facts? Are all you statements predicated from yesterday's pre-annoucement? Of course you couldn't have made any of those comments for the many past qtrs of year over year growth, good earnings, increased market share, more oem deals, STB deals, games consoles with Nintendo, new graphics in the pipe, etc ... Do you always see the world from the negative angle of things? Or did somebody pee in your coffee today? As for the analysts, I've yet to find one with any ethics or backbone. Just recently, they all trampled each other to death to upgrade ATI. So, what has dramatically changed from what they assessed of the company's fundamentals and strategy then to alter their projections so extremely as they did today? Yes, the pre-announcement sucked, but that doesn't justify today's trampling (again) at the newswire gate to downgrade to the extent they did. Did they listen to ATI's explanation? Did they believe the explanation? If not, why? Where's their analysis/justification of the downgrade? Or do they just believe the public is a herd of sheep that they can manipulate? Unfortunately, I tend to believe the latter. As I see it, all great companies, and that includes ATI, have blips on the road to growth, even Intel has had many, and they often come out the better because of them. It may be a hard pill to swallow, but I accept for now that ATI made the right decisions given the events they were confronted with and couldn't control. IMHO, they will be the better and greater company for it.

To: Robert who wrote (5548)	5/26/2000 2:02:00 PM
From: NTT	Read Replies (2) \| Respond to of 5927

To briefly answer your points: >Loss of market share On the contrary, the market share has increased overall according to the latest reports, particularly in areas such as mobile where ATI has taken a commanding lead. Let's not forget entirely new arenas of growth such as STBs, consoles, and internet appliances. >Competitors like Intel and Nvidia There is no additional threat. Intel's threat has considerably diminished over the past year, whereas nVidia's has grown. And lets not forget that many of their older competitors are considerably less of a threat: ie matrox, S3, 3Dfx, and neomagic. >Shrinking margins This is perfectly normal in any maturing company/industry. This is not something that's unique to ATI. ATI's CC guidance has always been towards reduced gross margins going forward, so this should not come as a surprise to anyone. However, lets not forget that their projected revenues are also CONSIDERABLY higher, year over year so that does cancel out the reduced margins. ie 1.8B-2.0B revenue for the coming year. This was all factored in by analysts when they were giving their 12 month targets. What's changed? If anything, there's lots of new high margin products coming out, ie Radeon256, HDTV, etc. >Flat to shrinking revenue growth Yes, this is true for this quarter, but their projected revenue for the year is still considerably higher for the year. It's not flat at all. >Negative earnings Yes, when you take into account increased R&D and the massive writedown they had. This is true of this quarter only. ATI isn't some online auction company running from a basement that's going to have 20 quarters of negative earnings. This is a solid company, with solid products and solid revenues, going through some hard times because of the economy. It has been waaay oversold, as can be seen by the HUGE buying interest currently. Sure it won't be back to $30 anytime soon, but high teens in a short term outlook is not out of the question as long as the rest of the market can hold its ground.