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To: Piranha who wrote (12521)	5/13/1999 11:52:00 AM
From: Plaz	Respond to of 16960

I did hear back from Mercury Research. Here it is: ----------------- We didn't overclock the board; Diamond sent us a board running at that speed. We're anxious to see the 183MHz board from 3Dfx, but they weren't able to ship us one in time for our roundup. So yeah, the TNT2 board had a bit of an advantage this time out, but invariably that's always how it seems to work out. We run into problems like this every quarter. We historically haven't overclocked, but run the boards at the default setting. This levels the field for cards that we can buy. But we're a bit at the mercy of the hardware vendors with early eval stuff -- in fact, 3Dfx pulled a similar stunt with Voodoo Banshee a couple quarters back. Frankly, we perform our testing as a service to hardware suppliers, not for consumers -- although it's obviously generated a lot of interest anyway. That's why we post the clock rates of the hardware tested, so engineers at, say, Compaq can include them in their analysis. For this community, there's no additional explanation needed -- so we don't plan to post any more on this topic. We have some plans to improve our testing with a more consumer-focused approach. We'll be updating the results more often, and have some other ideas to make the information more appropriate for consumers. Be patient. I think you'll be pleased. Thanks for writing, Mike Feibus

To: Piranha who wrote (12521)	5/13/1999 12:11:00 PM
From: Obewon	Read Replies (1) \| Respond to of 16960

Well, dagnabit! You stole my thunder right back with your high speed scanner! So there!! ;) Obewon

To: Piranha who wrote (12521)	5/13/1999 7:36:00 PM
From: Patrick Grinsell	Read Replies (1) \| Respond to of 16960

DLJ estimates don't make sense... Okay, assuming that 3dfx is telling everybody to shoot for a target of around 600M for revenues in 1999, then the 2000 and 2001 numbers look way too low. Actually, if 3dfx really does think they can do 50% OEM then 600M in revenues is way to low, but I'll stick with company guidance here. Operating margins for STB were at about -1% and 3dfx at 11%. Since revenues for each company were fairly close, I think we can average the two numbers to get a rough estimate. That gives an average operating margin of 5%. Using 24M shares outstanding yields eps of $1.25 for 1999 based on this information alone. From DLJ's own comments: The union of 3dfx and STB should eliminate inefficiencies and improve margins on board sales. I didn't even take this into account in the above analysis. What's wrong with this picture? The way I figure it is the following must be the issue: A) DLJ is being very conservative. B) 3dfx is planning on going on a spending spree. (DZ did tell me that SG&A should remain even relative to revenues for the combined company so this doesn't make sense.) C) A combination of the above. The conference call should be revealing. Pat