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

To: Michael Linov who wrote (8049)	10/8/1998 7:20:00 PM
From: Michael Linov	Read Replies (2) \| Respond to of 16960

DIMD Conference call: This is my own transcript... Bill Shroeder Jim Walker CFO Industry environment - Drive inventory to short cycle model Emphasize and Invest investment and hr Lower cost business model / outsourcing to far east Turnkey in far east MB, ... some Graphics, modem Cut inventory in half Reduced channel inventory to 6-8 weeks ( Monster II is high season, but slower to move?) New products this month Home Free (Home networking product line , wireless and wired PNA) 1Q Home gateway for both network Monster Sound + Sonic Impact - Strategic Alliance with A3D (AURL) a3d is to audio as to Glide to video (Glide has been?) Reo (MP3) hot product - high expectations , ideal for direct sales over net Viper V550 Differentiate value through own software Differentiated System board Viper 550 video addon? Increased OEM volume PC Business coming back after tough 2-3 quarters Not as strong as a year ago... more caution in channel Fewer larger suppliers to OEM customers Good trend for larger companies 123.2M Profits Qtr. YTD 481.7 M Net loss for qtr 22.2M (.63) compared to .7 (97). First 3 qtr net loss (.65) compared to 1.54 (97 3 qtr) MM System 80% Net revenue Modems 20% International 40% Reduction in shipment of Monster 2... 25% 3d quarter of 2nd. Net revenues flat. Modems down. Gross margins heavily affected by volume lower (operations overhead higher) pricing pressure in core graphics sector (lower average) Sold ALL legacy product through Reduced demand of monster II lead to price protection charges Memory prices were 2nd quarter prices, but low sale prices 10-12% Margin model. Inhouse invetory half of 2nd quarter. Operating expenses 31.6m ... added 20 design engineers Cash balance decreased to 78M Micronics aquisition Digital Cast Strategic investment in NVIDIA 4th typically strong quarter. Viper 550 (TNT) Monster Fusion (Banshee) Backlog on both products. Inventory under control. Overall higher backlog. Q & A PC Prices are going down at more than 2% a month Semiconductor pricing collapse (memory) Deflationary Environment. High inventory is bad in deflationary environment. Structuring self assuming this will continue