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Technology Stocks : S3 (A LONGER TERM PERSPECTIVE) -- Ignore unavailable to you. Want to Upgrade?

To: Bill Lin who wrote (11016)	5/21/1998 5:21:00 PM
From: Don Earl	Read Replies (1) \| Respond to of 14577

Hi Bill, From what I understand, it's the profit margin on PCs that is down, not units shipped. As much as I dislike Microsoft and their business practices, Windows 98 hits the streets in a few weeks. If my somewhat unreliable memory serves me correctly, Windows 98 will include some of the Direct X code that's related to the licensing deal with S3. With Savage 3D shipping in sample quantities, I don't think there will be any unusual R&D expenses. I believe the conference call mentioned that they would be writing off some depreciation on the Cirrus patents over the next several years, otherwise, all the big write offs took place last quarter. I expect lousy earnings this quarter, but with a major release around the corner, I sincerely doubt it will go below current levels. There's plenty of time between now and earnings for it to bounce around in it's wild assed, 25% trading range. Watching it go up and down is enough to make a person sea sick. May as well play it. Regards, Don

To: Bill Lin who wrote (11016)	5/21/1998 6:17:00 PM
From: Ken Muller	Respond to of 14577

Bill: In the STB Conference Call, they indicated (in response to an analyst's question) that they were looking at the Savage 3D and were expecting to position it as a mid range product, assuming the price levels were acceptable. I think the big question that has yet to be addressed is what the market will pay for this chip. Ken

To: Bill Lin who wrote (11016)	5/24/1998 8:07:00 PM
From: Synapsid	Read Replies (2) \| Respond to of 14577

Here's a link to a massively detailed (although often contradictory) report on Asian add-in card manufacturers, a market S3 has been dominating and from which the overwhelming majority of its revenues are currently derived. asiansources.com To summarize some interesting facts I came across: AGP-cards rapidly going towards 50% share (vs. PCI), already near 40%. New cheap generic cards (also AGP) with Trident and SiS chipsets well accepted in the Americas (at S3's expense), but S3 cards with higher quotes holding on better in Europe due to brand name recognition. 8MB of SDRAM said to be cheaper than 4MB SGRAM (SGRAM expected to drop though). Overwhelming acceptance of Intel i740, priced at $25, helped by the SDRAM conspiracy, but still in the higher end of mainstream volumes. Someone is quoted that the i740 forced S3 to lower prices below $20 earlier in the year (presumably for AGP-based chips, but it still seems a relatively high level when S3's ASPs are supposedly in the high single-digits). Design win implied at Data Expert (one of the biggest manufacturers and S3's most loyal) for S3 Savage3D (must be a first), also said to ship 60-70% of product with S3 chip (which I'd imagine would have been 90%+ in the past). I am still wondering whether the rapid shift to AGP may actually help bottom-dwellers S3 and Trident, because AGP chips may still be selling at a higher price then PCI-based chips did, say, half a year or so ago.