The graphics-chip company is about to abandon the card-manufacturing business. The company plans to close its Juarez, Mexico, card manufacturing plant and remove itself from the business of building the graphics cards that reside in desktop PCs. This is an abrupt switch from the December 1998 takeover of STB Systems, which 3dfx heralded as a move that would put them in charge of their own destiny. Instead, that move -- combined with numerous production delays and supply problems -- has removed the company from its once-dominant position in the industry.
"We're trying to be more fiscally responsible," said Lisa Grubb, a spokesperson for the company. "Basically, we're reinventing ourselves."
The company says it will now sell its chips to third-party manufacturers, who will create the boards that go in computers. Because 3dfx is in its quiet period (its latest earnings are due next week), officials declined to say how much of a write off would result from the closing of the Mexican plant.
The company's not betting its entire future on PC graphics, though. While it will retain the "Voodoo" name - a very familiar one in graphics and arguably the company's most valuable asset -- it is branching into new territory. It recently released the VoodooTV card, allowing PC users to use their computer monitor as a TV screen. And it plans to use the recently completed acquisition of competitor GigaPixel Corp. to forge into new areas, such as set-top boxes, cellular phones, game consoles and handheld PCs.