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3dfx fires 20 per cent of workforce

Graphics company's new CEO swings the axe, as promised

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The scheduled launch date for 3dfx's upcoming next-generation Voodoo 4 and 5 graphics acceleration products may be getting nearer, but not close enough to save the company financial embarrassment. Last week the loss-making company was forced to lay off 20 per cent of its staff -- 130 people in total -- in a bid to cut costs. It also said its high-end Special Technologies Group would be spun off, again in a bid to reduce the company's overheads. Getting rid of the STG will contribute to the overall jobs cuts. The STG develops Voodoo-based products for the Windows NT workstation market, something that's arguably more the purview of 3dfx's partner Quantum 3D, which operates in the high-end simulation market and in which 3dfx has also invested. Not that a swinging axe should surprise anyone. CEO Alex Leupp, who replaced the disgraced Greg Ballard last November, said at the time he was willing to make major cuts in order to get 3dfx back to profitability. 3dfx went into the red during its first quarter of 1999 after the company splashed out on the acquisition of board maker STB. However, the much-delayed development of its VSA-100 chip, the successor to the Voodoo 3, has clearly proved costly. VSA-100 based products were originally slated to ship during autumn 1999, but will now not see light of day before spring 2000, a six-month slide that prompted Ballard's resignation. ®

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