STOCKREPORTS

OPTi Inc.

NASDAQ Symbol OPTI

Recent Price 5.50 52 Wk Range 6.50 - 4.44

Yield Nil 12-Mo. P/E NM

Quantitative Evaluation: Outlook (1 Lowest - 5 Highest) NA Fair Value NA Risk HIGH Earn/Div Rank NR
Technical Evaluation: BULLISH since 04/97 Rel. Strength Rank (1 Lowest - 99 Highest) 77 Insider Activity NA

Business Profile 01-JUL-97

The company's strategy is to deliver new, innovative and cost-effective products in a timely manner, develop products for emerging markets in the high performance PC segment, increase sales in existing global markets, and strengthen its industry relationships. In June 1997, OPTI said it was experiencing a softening in demand for its audio solutions as well as a decrease in selling price in that market, and as a result was expecting a loss of $0.30 to $0.45 a share in the second quarter as well as a loss for the full year. The company posted a $14 million net loss for 1996, as its earnings were plagued by a product transition as lower demand for desktop products outweighed strong demand for notebook and audio products..

Operation Review 01-JUL-97

In the first quarter of 1997, net sales fell 35%, year to year, reflecting lower sales of OPTI's pentium-class desktop core logic products due to a continuing transition to mobile core logic products and audio controller products, both of which had increased sales. Gross margins improved sharply due to the prior-year write-off of certain inventories coupled with an improved product mix, reduced wafer prices and cost reductions associated with more advanced wafer technology. Following flat R&D costs and 11% lower SG&A expenses, the net loss narrowed to $259,000 ($0.02 a share, on 4.3% more shares), from $3,125,000 ($0.26).

Stock Performance 18-JUL-97n

In the past 30 trading days, OPTI's shares have increased 7%, compared to a 7% rise in the S&P 500. Average trading volume for the past five days was 207,020 shares, compared with the 40-day moving average of 97,853 shares.

Key Stock Statistics

Fiscal Year Ending Dec. 31

Dividend Data: No cash dividends have been paid. The company intends to retain its earnings for use in the development and operation of its business and does anticipate paying cash dividends in the foreseeable future.

Business Summary 01-JUL-97

OPTi Inc. is a leading independent supplier of multimedia chipsets including core logic and audio logic controller products to the personal computer market. Its chipsets provide in semiconductor devices the core logic functions of a PC as well as multimedia functions.

In 1996, the company underwent a transition due to significant reduction in marketshare of its core logic chipsets for the desktop PC market. This marketshare loss was due to aggressive competition, primarily from Intel Corp. As a result, the company is moving its focus to mobile core logic and audio products, as well as new initiatives to develop and acquire technologies for future product applications. In 1996, sales of core logic chipsets accounted for about 71% of the company's revenues, of which 59% was for notebook applications and 41% was for desktop uses.

Pentium-based products, which were first shipped in mid-1993, include the Viper, the Viper M, the ViperMax and the Viper N. The Viper M is a highly integrated, high performance chipset solution that is designed to support Intel's Pentium microprocessors as well as AMD's 5K86 and Cyrix's M1 microprocessors. The Viper M also supports multimedia functions, including IDE Bus Master, EDO DRAM and Type F DMA.

In October 1995, the company introduced the ViperMax, its fifth generation chipset supporting Pentium-class microprocessors. The ViperMax adds Unified Memory Architecture and Universal Serial Bus to the Viper family, which OPTi feels may enable a system manufacturer to save DRAM memory per system and reduce cost. In June 1995, OPTi began shipping its first Pentium-based notebook product, the Viper N, which incorporates desktop performance features. In the first quarter of 1997, OPTi began shipment of the Firestar single chip product for mobile applications.

The audio controller market consists of audio products for use in the add-in card market and audio products installed directly on the motherboard. Recent introductions include the 82C941, a Wavetable synthesizer product that creates high quality, realistic musical sound and is designed for use in musical instruments, karaoke machines, MIDI modules and PC sound card applications, and the 82C931, which integrates audio capabilities on the motherboard or an add-in card.

Products are sold primarily to PC, motherboard and add-on board manufacturers in the U.S. and Asia. In 1996, sales to customers in Asia accounted for 80% of net sales (59% in 1995).

Important Developments

Jun. '97 The company forecast lower-than-expected revenues for the second quarter and full year 1997, due to a softening in demand and price for its audio solutions. OPTI anticipates a net loss of $0.30 to $0.45 a share for the second quarter as well as a net operating loss for the full year.

Capitalization

Long Term Liabilities: $4,412,000 (3/97).

Curr. Ratio	6.3	4.4	3.9	4.0	NA	NA	NA	NA	NA	NA
% LT Debt of Cap.	4.6	3.5	2.8	1.3	0.5	Nil	Nil	NA	NA	NA
% Net Inc.of Revs.	NM	6.9	10.9	10.8	9.3	8.2	18.7	NA	NA	NA
% Ret. on Assets	NM	9.0	17.1	19.5	32.5	30.4	45.0	NA	NA	NA
% Ret. on Equity	NM	12.0	22.7	26.5	57.9	64.4	NA	NA	NA	NA

Data as orig. reptd.; bef. results of disc. opers. and/or spec. items. Per share data adj. for stk. divs. as of ex-div. date. E-Estimated. NA-Not Available. NM-Not Meaningful. NR-Not Ranked.

Office--888 Tasman Dr., Milpitas, CA 95035. Tel--(408) 486-8000. Website--http://www.opti.com Chrmn & CEO--J. Chang. Pres--S. A. Dukker. COO, CFO & Secy--D. Zacarias. Dirs--T. R. Braham, J. Chang, S. A. Dukker, D. Lin, B. T. Marren, K. K. Nanda. Transfer Agent & Registrar--First National Bank of Boston. Incorporated--in California in 1989. Empl-- 0. S&P Analyst: Jim Corridore

This report is for information purposes and should not be considered a solicitation to buy or sell any security. Neither S&P nor any other party guarantee its accuracy or make warranties regarding results from its usage. Redistribution is prohibited without written permission. Copyright © 1997