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

To: Brad Patton who wrote (10439)	2/1/1999 1:54:00 PM
From: Sun Tzu	Read Replies (1) \| Respond to of 16960

Sounds interesting but as wrong as it may seem, I tend to weigh the present as 80+% and the rumors and future promises as significantly less. When and if S3 or anyone else comes with killer chip, I will reassess the situation then. In the mean time, TDFX is taking a beating due to -- believe it or not -- the Creative's CC. Here is the relevant news from a research report issued after the Creative's CC: Creative has dropped 3Dfx's chips from its line of products, a move that is expected to cut about US$25 million to US$50 million from revenue per quarter going forward. The acquisition by graphics chip manufacturer 3Dfx (TDFX.US, US$12.69, not rated) of add-in board manufacturer STB Systems (STBI.US, US$7.50, not rated), which was announced in December, led Creative to drop 3Dfx's Voodoo2 and Banshee brand chips from its line of 3D graphics products in January 1999. STB Systems is a direct competitor to Creative. We estimate that the Voodoo2 and Banshee-based boards contributed about US$50 million to US$60 million to Creative's revenue for the second quarter of 1999 or about 12% of total revenue for the quarter. It will be difficult, in our view, for Creative to make up this contribution using chips from another vendor, Nvidia, within the next two to three quarters. Personally I find the last line of the first paragraph interesting. In any event, neither CREAF, nor TDFX and NVDA are a buy for now. Cheers, Sun Tzu