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To: TigerPaw who wrote (8682)	10/29/1998 5:18:00 PM
From: Obewon	Respond to of 16960

Heres an artcle from www.techweb.com : <<S3 Sees Losses Through 1999 (10/28/98 4:09 p.m. ET) By Mark Hachman, Electronic Buyers' News Graphics-chip maker S3 reported a net loss of $35.4 million for its third quarter on sales of $47.3 million, a 165 percent drop in revenue year-over-year. S3 included a one-time charge of $18 million associated with restructuring and write-downs of older 2-D/3-D graphics chips. Sales fell 11 percent from the prior quarter, while S3's loss widened by 149 percent. "For the next couple quarters we expect pretty substantial losses," said Walt Amaral, chief financial officer for Santa Clara, Calif.-based S3. Amaral said he does not expect a return to profitability until S3's sales reflect a greater percentage of its latest Savage3D 2-D/3-D video chips, which should happen by the second or third quarter of 1999. By then, said president and CEO Terry Holdt, S3 expects one or two derivatives of the Savage3D to be available, including a version for notebook PCs that will sample by the second quarter 1999, as well as a low-cost derivative for motherboards. Holdt also said he expects a number of top-tier OEMs<Picture> will shortly announce design wins based on the Savage3D. During the third quarter, 92 percent of the company's chips were sold in Asia. Sales to PC add-on card OEMs totaled 64 percent, with the remainder sold to manufacturers of PC motherboards. Holdt acknowledged the company had lost market share by missing a product generation and failing to capitalize on the introduction of the AGP<Picture> technology that Intel designed, but pledged to be one of the first to market with a chip running at the "4X" AGP speed. Although the Savage3D can address up to only 8 megabytes of frame buffer DRAM<Picture>, S3 executives said the chip is a contender in the performance-graphics space. Holdt also defended S3's traditional niche of being a volume supplier of chips with mainstream performance, a position ATI Technologies has usurped. "Despite current conditions, we feel we are a force to be reckoned with in the future," Holdt said. "So, our focus now has got to be to continue to develop the Savage architecture products, and move them into the marketplace. We'll hang in there during the rough periods, which we certainly had during the last quarter, but we have the confidence that we're going to be there with our new re-architected products." <Picture: TW> >>