Speculation is growing that the graphics-accelerator market for the Mac may be entering a period of consolidation, after both 3dfx and ATI announced profit warnings.

3dfx issued a profits warning to its shareholders last week. Also last week Apple’s graphics accelerator partner ATI announced greater-than-expected third-quarter losses.

ATI shares reached a 52-week low, closing at $8.5. 3dfx hit $7.7813, while Nvidia’s shares stand at $63.5625. Last week, US regulatory authorities approved 3dfx’s acquisition of Gigapixel, who design and develop 3D technology.

ATI, like 3dfx, blamed component shortages, excess inventory problems and competitor cost-cutting for the fall in profits. Sales for the three months ending May 31 were $288.2 million, a fall of 4.6 per cent on the same period last year. The company also said it expects sales in its fourth quarter to be slightly lower than its third-quarter revenues.

Margins warning Jim Chwartacky, ATI’s chief financial officer, says: "In the near term, competitive issues are not expected to abate, so margins in the fourth quarter are likely to be in the low to mid-20 per cent range." ATI wrote off $64 million worth of excess and slow-moving inventory in the period, Reuters reports.

Nvidia may form a partnership with Apple to manufacture its new GeForce 2 MX chipset, according to The Register. Nvidia does not manufacture its technologies - it licenses them out to OEM’s. 3dfx has been vocal in requesting that Apple open up the 3D accelerator market to players other than ATI, who manufacture the graphics chipsets in Apple’s current crop of machines.