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Technology Stocks : 3DFX -- Ignore unavailable to you. Want to Upgrade?

To: M. Rantila who wrote (5965)	8/3/1998 10:06:00 AM
From: Michael G. Potter	Read Replies (2) \| Respond to of 16960

I'm trying to keep an eye on what 3dfx's competition is up to. I think that the TNT price (much lower than expected) is both a worry and good news. The worry is that it will increase the fear that chipset prices will be under so much pressure that no one in the industry will be able to make much money. The good news is that the Voodoo2 boards have proven that high-end boards will sell for $300. The fact that Nvidia is pricing much lower than the original estimates probably means that they are not as good as the V2, especially V2 SLI. Some of the price drop has to be the lower cost of memory, but I think they decided to go with slower memory (with a performance hit) as well. The lower price will compete with the banshee card, but I haven't seen anything that shows the TNT seriously outclassing it. If 3dfx can keep its place at the top of the hill for 3d acceleration as we go into the xmas selling season, Q3 (end of quarter shipments to support Q4) and Q4 should be very good. I keep laughing every time I see "flat" earnings mentioned. First, the higher share count and the higher tax rate should be factored in (these show a nice growth). Plus, comparisons are normally do to the same period in the prior year which would show large gains. You want year-over-year growth. Airlines have dips in earnings every year based on seasonality. As 3dfx moves into the mainstream, their earnings will be somewhat less prone to following the consumer buying patterns for PC equipment, but even businesses tend to buy more at the beginning of the year (when budgets are fresh and optimism is high) than the end of the year (unless things are going real well and they want to "spend" all their budget). I hope the new PR company can come up with something better than Voodoo and Banshee for the mainstream market - not the best names to get into Fortune 500 boxes. Michael