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Investors braced for weak ATI Q1 results

Outlook for Q2 doesn't look too good either

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Canada's answer to Wall Street has given ATI the thumbs down - at least as far as the 3D graphics company's next-but-one set of quarterly results go.

ATI's Q1 results are due later today, but it is expected to details its forecast for Q2 too, and it's about these that analysts are sceptical, according to Bloomberg.

The problem is the declining PC market. With system sales slowing during ATI's first quarter, which ended 30 November 2000, OEMs will be ordering fewer graphics chips and cards during Q2. And that's clearly bad news for ATI.

And customers may turn to other suppliers. Apple, for one, recently decided to fit Nvidia chips into three of its four pro-oriented desktop machines. Until then it was an all-ATI house. Despite its strong position in the retail market, ATI makes most of its money from selling chips and add-in cards to PC vendors. A fall in sales here will hit it hard.

ATI is expected to announce earnings of three cents a share before one-off items, according to an average calculated by IBES International. This time last year, the company made 25 cents a share. ®

Register blows own trumpet, no. 94

Oh and yes, the patent cross-licensing deal between Intel and ATI that was announced yesterday, was indeed related to the now-defunct Read3D's action against ATI, just as we reckoned in our report (). Intel bought Real3D's patents when the latter collapsed back in October 1999. ®

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