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

To: Curbstone who wrote (8281)	10/15/1998 8:03:00 PM
From: Simon Cardinale	Read Replies (1) \| Respond to of 16960

What the CC questions didn't ask. 1) No questions about future products. a. geometry acceleration b. feature additions (16bit vs 32bit, single pass multitexturing beyond 2 TCUs, lighting, shadows, polygon vs. tile/ raytracing /whatever) 2) No questions about vertical integration. 3) Will multitexturing become widespread now that it's in DX/D3D? Are they working with developers? 4) Are they negotiating with set-top box makers? (They said no deals/talks for consoles, but then separated set-top boxes as competing with consoles. No one followed up with the obvious question!) 5) WHQL certification a problem? A problem in the future? 6) Orangutans? Overall the questions were a mixed bag, with technology related questions being scraped from the very bottom. Why ask if developers need to develop for DX6 to realize a performance benefit? Any programmer can answer that. Why go to the CEO of 3Dfx?! Ack! Simon

To: Curbstone who wrote (8281)	10/15/1998 8:18:00 PM
From: Patrick Grinsell	Respond to of 16960

Major points I got out of the conference call: Diamond ordered less than 10% of what they did from the last quarter for V2: 24M down to 2.4M They had a write off of 4.5 million. Without that GM would be 39% (about what I expected). Given the new price points for V2 ($35-$40) I expect that to go to 35% for 4Q. This means 3dfx must break 50M in order to break even for 4Q. Ouch! Since this will be the first full quarter of Banshee and it being the holiday season I put the odds at 50/50. A loss for 1Q99 is pretty much ensured. The only thing out of the ordinary is that 3dfx to the write down. It's actually a decision that I applaud as being very conservative. What was interesting is that DZ said that they would have to make more chips in order to move this inventory. The bottom line is that they have too many pixelfx chips by double or too few texelfx chips by 1/2. It looks like they aren't intending to fab ANY new Voodoo2 chips and will work from inventory going forward. I then expect the inventory numbers to drop off in a big way and cashflow to come screaming back in. Ballard mentioned that Nvidia is announcing deals before the OEM ships because they aren't public. Interesting. He said it just LOOKS like Nvidia is getting all the deals. Hmmm. Pat