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

To: Joe C. who wrote (7317)	9/16/1998 11:57:00 PM
From: joel3	Respond to of 16960

Questions for Ballard on Motely Fool. From TMF BB... ------------------------------------- 3Dfx called us up to do an interview tomorrow (Thursday) with CEO Greg Ballard in the wake of its earnings warning. What would you like for us to ask? Now he can't project exact numbers on sales, earnings, shipments, etc. But he can talk about the business in general. So let me have 'em! Post your suggestions here AND please email them to me at tmfpuck@aol.com (I know there's going to be a flood of questions, and given the time constraints, it'll be easier for me to deal with them if you send them to me directly). Thanks in advance. Foolishly yours, Yi-Hsin (TMF Puck)

To: Joe C. who wrote (7317)	9/17/1998 1:23:00 AM
From: Patrick Grinsell	Read Replies (1) \| Respond to of 16960

Joe, yeah I'm ticked but that doesn't invalidate my arguments. I think the word is realism not pessimism or optimism. I throw out these questions because there are truly reasons to be concerned. It seems obvious to me that we are in a better place than before the IPO. Branding, revenue volume, and the technology have all reached heights I did not think possible in this timeframe. These are all great things but the crux is being able to make money. The reason 3dfx can't make money, of course, is because it is spending to gain marketshare. If this were the same little company shooting after its niche market we'd be making money hand over fist. The future would be very limited, but we'd be making money. What concerns me is there is very REAL competition out there with no way to evalualate whether the company has a shot at being succesful. A solid roadmap with real timeframes will allow us as investors to hold management to their promises. What are their promises now? They will be doing some "stuff" sometime in 1999 that will be really cool and their nextgen product will be more revolutionary than Voodoo1. This is great but I've heard it before. What graphics company isn't saying these things? Let's just say that the future is somewhat less than clear. The near term data shows a quarterly loss as 3dfx is still topping the accelerator charts. I realize that sales "lumpiness" may be a factor but no data exists to show me that the add-in gaming market hasn't reached a saturation level. Seasonality of these proportions is really out of line given recent announcements from Intel, PC Data and others saying just the opposite. I think the true reason for the sales slowdown is something other than seasonality and 3dfx prefers to be coy at a time when they should be candid. So all the risks are there and I am left with no confident basis for saying that 3dfx will succeed in the OEM market. Except this: Of all the graphics chip makers only ATI has the makings of a solid company. Even Matrox, traditionally flush with OEM deals, has recently gone through a round of layoffs. Nvidia, 3dlabs, S3, Number 9, and Videologic are all at deaths door. I guess the bottom line is it comes down to the old saying, "You don't have to be faster than the bear just faster than the guy next to you." There will be time enough to be king after everyone else has been eaten alive. Summary: Short term sucks, long term not defined clearly, competition is weak. Hopefully the Fool interview will clarify some of my thoughts one way or the other. I've held since the IPO but this may be a turning point for me. Pat