STOCKS TO WATCH: Comverse Technology, Rambus and 3Dfx Interactive

3 min read

Expect the following technology stocks to be among Wednesday's most actively traded issues: Comverse Technology, Rambus and 3Dfx Interactive.

  • Comverse Technology (Nasdaq: CMVT)

    Comverse Technology shares will be active after the software developer topped analysts' estimates by 2 cents a share in its second quarter.

    In the quarter, Comverse raked in $62.5 million, or 36 cents a share, on sales of $292 million.

    First Call Corp. consensus expected it to earn 34 cents a share in the quarter.

    Comverse shares closed off 7/8 to 89 9/16 ahead of the earnings report.

    The $292 million in sales marks a 35 percent jump from the year-ago quarter when it earned $41 million, or 26 cents a share, on sales of $217 million.

    The strong second-quarter results mark the 25th consecutive quarter Comverse has topped analysts' estimates.

  • Rambus (Nasdaq: RMBS)

    Rambus should be worth watching Wednesday after Micron Technology (Nasdaq: MU) said late Tuesday it had filed federal lawsuit against the chipmaker in an attempt to head off potential Rambus claims that Micron has infringed on some of its patents.

    A complaint was filed as a preemptive strike late Monday in U.S. District Court in Delaware, where Micron is incorporated, the company said. It asserts violations of federal antitrust laws, as well as invalidity, non-infringement and non-enforceability of eight Rambus patents.

    Micron claims both companies participated in a semiconductor industry association that had the goal of developing open technical standards for computer chips known as "synchronous dynamic random access memory," or SDRAM.

    Instead, Micron alleges, Rambus applied for patents on the technology without informing other association members and now is pursuing a campaign "designed to exact essentially nonnegotiable licenses bearing exorbitant royalties from these manufacturers."

    Rambus shares closed off 3 3/8 to 80 5/8 Tuesday.

  • 3Dfx Interactive (Nasdaq: TDFX)

    The chipmaker could be in for a rough day Wednesday after it posted a net loss of $100.5 million, or $3.81 a share, on sales of $67 million in its second quarter.

    There was no First Call Corp. consensus estimate for the chipmaker in the quarter.

    Its shares closed off 11/16, or 11 percent, to 5 7/16 Tuesday.

    Earlier in the quarter, company officials warned its second quarter sales would fall below analysts' expectations, due to what it called a temporary component shortfall.

    "Clearly, we are very disappointed with this quarter's financial results," said CEO Alex Leupp in a prepared release. "During the quarter, we were simultaneously faced with product transition, component supply and seasonality issues."

    Making matters worse, 3Dfx (Nasdaq: TDFX) was tagged by a patent infringement suit from competitor NVIDIA (Nasdaq: NVDA).

    NVIDIA claims that 3Dfx's graphics chip and card products infringe on five NVIDIA patents.

    3Dfx officials vowed to fight the suit, calling it nothing more than a shakedown.

    "NVIDIA's filing of a suit is clearly an attempt to force a settlement of our existing patent infringement lawsuit against NVIDIA," Leupp said in a prepared release. "3dfx intends to vigorously defend itself against this litigation."