3Dlabs reports first quarter 1997 results.

HAMILTON, Bermuda--(BUSINESS WIRE)--April 30, 1997--3Dlabs(R) Inc. Ltd. (NASDAQ: TDDDF) today announced record financial results for the first quarter ended March 31, 1997.

Revenues in the first quarter were $15.76 million, up 773% from the $1.81 million reported in the first quarter of 1996 and up 83% from the $8.61 million reported in the fourth quarter of 1996.

Net income for the first quarter was $5.38 million, or $0.34 per share, compared with a loss of ($1.01) million, or ($0.08) per share, in the first quarter of 1996, and up 150% from the $2.15 million, or $0.15 per share, reported in the fourth quarter of 1996.

"We continued to deliver substantial revenue and earnings growth for our shareholders" said Osman Kent, president and CEO of 3Dlabs. "Demand for our current generation products was significantly higher in the March quarter, and we expect to introduce additional products with higher functionality and performance in forthcoming quarters"

In a separate press release today, 3Dlabs announced that Douglas S. Miller has joined the company as vice president and Chief Financial Officer. Prior to joining 3Dlabs, Miller was a partner with Ernst & Young LLP where he had worked for over eighteen years serving companies in the technology industry. Miller will be responsible for overseeing the worldwide financial and reporting aspects of 3Dlabs, and will be based at the company's San Jose offices.

"Doug brings a tremendous wealth of financial and industry experience to our senior management team", said Tom Donohue, vice president of finance and COO. "As we grow, we expect an increasing focus on our company's financial goals and infrastructure where Doug can provide strong leadership and direction"

First Quarter Highlights

-- 3Dlabs announces breakthrough GLINT(R) Gamma(TM) technology leveraging Intel's AGP

As part of Intel's Visual Computing Initiative, in March the company announced that it is developing a 1,000 Mflop 3D geometry transform and lighting accelerator called GLINT Gamma. This device, which is intended to be the first AGP-compliant (Accelerated Graphics Port) graphics product for the high-end professional 3D graphics market on the PC, integrates the full OpenGL(R) geometry pipeline into a single merchant chip. This device is expected to deliver up to 3.3 million transformed and lit polygons-per-second. GLINT Gamma is designed to complement 3Dlabs' current and future GLINT family of products and it is currently expected that boards incorporating this technology will start shipping during the second half of 1997, coinciding with the availability of AGP systems.

-- 3Dlabs and Microsoft Direct3D Masterclass attracts more than 130 top game developers.

In February, 3Dlabs and Microsoft held a joint Direct3D masterclass, attracting over 130 programmers and R&D managers from the world's top game development companies, including Bullfrog, Computer Artworks, Core Design, DID, Eidos, Electronic Arts, Innerworkings, Microprose, Mindscape, Ocean, Psygnosis and Virgin. Many developers demonstrated unreleased Direct3D titles currently under development using PERMEDIA(R) systems provided by 3Dlabs. The two-day seminar gave developers practical advice on efficient code generation, hardware and software optimization techniques. Direct3D is Microsoft's consumer-level rendering API for real-time 3D graphics programming.

-- 3Dlabs' PERMEDIA gains eight new design-wins with Taiwanese graphics vendors.

During CeBIT'97, 3Dlabs announced eight new PERMEDIA design-wins from leading Taiwan-based systems and graphics board companies, bringing the number of total PERMEDIA design-wins world-wide to over fifteen. The eight new companies now offering PERMEDIA or PERMEDIA NT based solutions are Britek, DataExpert, Deltron, Gainward, GVC Media, Mitac, Tekram and UMAX. Most of these companies demonstrated their PERMEDIA-based products at CeBIT'97 for the first time. Existing PERMEDIA design-wins include products offered by AccelGraphics, Acer, Creative Labs, Diamond Multimedia, ELSA, Leadtek, MaxVision, NeTpower, Omnicomp and STB/Symmetric.

-- 3Dlabs' Boosts GLINT OpenGL performance by over 70%

In two successive announcements, 3Dlabs has revealed that it has significantly enhanced the OpenGL performance of its GLINT processors through proprietary software enhancements, exploiting the headroom available in its current generation of silicon. The new reference software drivers using Microsoft's installable client driver (ICD) architecture, increase the Viewperf benchmark figures by up to 70% compared to figures published six months ago. Performance figures posted by Intel for a Dell Dimension system with an Omnicomp GLINT 500TX and GLINT Delta board achieve the industry's best price/performance figures.

Certain GLINT systems now deliver a CDRS score of 20.48 at true-color depths compared to 19.59 for Intergraph Intense 3D-T Pro 1000 and 17.24 for certain Silicon Graphics' O2 workstations. When using the Data Explorer Viewperf benchmark, certain GLINT systems using the new software drivers deliver a score of 4.52, easily exceeding the figures published for Intergraph's Intense 3D-T Pro 1000 of 3.51 and 2.88 for Silicon Graphics' O2 workstations.

The performance data in this press release is based on Viewperf figures posted to the OPC web site in early April 1997. OPC (OpenGL Performance Characterization) group, part of the Standard Performance Evaluation Corporation (SPEC), administers the usage of Viewperf benchmarks and reviews the benchmark submissions before they are approved for publication on http://www.specbench.org/gpc/opc.static/index.html, the official OPC web site.

About 3Dlabs

Founded in 1994, 3Dlabs is a leading innovator and a fabless supplier of high-performance graphics semiconductors, software, and related technologies designed to bring cost-effective 3D graphics to the personal computer. The Company markets and sells its award-winning merchant 3D graphics processors to PC and graphics board OEM customers and selectively licenses its embeddable graphics processor cores on a royalty-bearing basis to strategic technology partners such as Texas Instruments.

Companies using 3Dlabs' graphics processors in their computers include Compaq, Digital Equipment Corporation, Hewlett-Packard, NEC, NeTpower and Siemens. Leading board manufacturers using 3Dlabs' graphics processors include AccelGraphics, Creative Labs, Diamond Multimedia, ELSA and STB/Symmetric. -0-

Various matters set forth in this press release, such as statements (i) relating to the Company's ability to drive technological developments; (ii) the Company's growth and expansion into markets; (iii) the ability of the Company to successfully develop, integrate and market new technologies and products such as GLINT Gamma on any specific timescales, if at all; (iv) the proposed features and uses of new products; and (v) the proposed timing of the introduction of new products are forward looking statements. These statements are subject to risks and uncertainties, including without limitation, the Company's ability to complete development of new products and technologies in a commercially viable manner; the ability of the Company to continue to obtain design wins for its current and future products; the ability of Company's current and future products to adequately meet the price/performance requirements of its customers; the success of the Company's customers in achieving sustained demand for systems incorporating the company's current and future products if at all; the impact and pricing of competitive products, including those from Company's licensees; the introduction of alternative technological advances and other risks detailed from time to time in 3Dlabs' SEC reports. -0-

Notes to Editors: Please note that 3Dlabs is written as one word, without a space and with a capital D. The recommended way of writing GLINT is all capitals and for PERMEDIA we recommend small caps or all caps depending on the medium.

3Dlabs, GLINT and PERMEDIA are registered trademarks and GLINT Delta, GLINT Gamma and PERMEDIA NT are trademarks of 3Dlabs Inc. Ltd. Microsoft, Windows and Direct3D are either registered trademarks or trademarks of Microsoft Corp. in the United States and/or other countries. OpenGL is a registered trademark of Silicon Graphics, Inc. All other trademarks are acknowledged and recognized. -0-

                                3Dlabs Inc. Ltd.
               Condensed Consolidated Statement of Operations
                      (in $000s, except per share amounts)

                                       Quarter ended
                                  Mar 31 1997  Mar 31 1996
Revenues
  Products                           15,082      1,372
  License, Royalty and other            682        433
                                  _________________________
              Total Revenues         15,764      1,805
                                  _________________________

Cost of Revenues
  Products                            5,862        679
  License, Royalty and other              -        178
                                  _________________________
      Total Cost of Revenues          5,862        857
                                   _________________________
Gross Profit                          9,902        948

Operating Expenses
  Research and Development            1,354        991
  Sales and Marketing                 2,261        744
  General and Administrative            569        198
                                  _________________________
    Total Operating Expenses          4,184      1,933
                                  _________________________


Income (loss) from Operations         5,717       (985)
Other Income                            275         20
                                  _________________________

Income (loss) before taxes            5,992       (965)
                                  _________________________

Provision for Income Taxes              608         45
                                  _________________________
Net Income (loss)                     5,384     (1,010)

                                  _________________________
Net income (loss) per share            0.34      (0.08)
                                  _________________________

Shares used in computing income
  (loss) per share (000s)            15,853     13,352
                                     ______     ______
                                     ______     ______


3Dlabs Inc. Ltd.
                    Condensed Consolidated Balance Sheets
                                  (in $000s)
                                               _____________________
                                               03/31/97  12/31/96
                                               _____________________
Assets

Current Assets
    Cash and short term investments             27,958    23,157
    Accounts receivables                         8,488     7,207
    Inventories                                  1,483       559
    Prepaid expenses and other current assets      664       618
                                               ____________________
                          Total Current Assets  38,593    31,541
                                               ____________________

    Property and equipment, net                  1,816     1,587
    Deferred tax assets                            475       475
    Acquired patents, net                        1,009     1,147
                                               ____________________
                                  Total Assets  41,893    34,750
                                               ____________________
Liabilities and Shareholders' Equity

Current Liabilities

    Accounts payable                             3,079     2,691
    Accrued liabilities                          2,555       785
    Income taxes payable                         1,232       630
    Current portion of long term debt              257     1,270
                                               ____________________
                     Total Current Liabilities   7,123     5,376

    Long term debt                                 121       198
                                               ____________________
                             Total Liabilities   7,244     5,574
                                               ____________________

Shareholders' Equity

    Common stock                                   147       147
    Additional paid-in capital                  31,278    31,278
    Retained earnings (deficit)                  3,464    (1,920)
    Deferred compensation                         (200)     (229)
    Cumulative translation adjustment              (24)      (84)
    Notes receivable from shareholders             (16)      (16)
                                               ____________________
                    Total Shareholders' Equity   34,649    29,176
                                               ____________________

                                         Total  41,893    34,750
                                                ______    ______
                                                ______    ______

CONTACT: 3DLabs

Osman Kent, 408/436 3455

[e-mail]

Tom Donohue, 408/436-3455

[e-mail]