<PAGE>   1
 
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
 
                       SECURITIES AND EXCHANGE COMMISSION
 
                             WASHINGTON, D.C. 20549
                            ------------------------
 
                                  FORM 10-K/A
                                AMENDMENT NO. 1
                            ------------------------
(MARK ONE)
      [X]   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
        SECURITIES EXCHANGE ACT OF 1934
 
                  FOR THE FISCAL YEAR ENDED DECEMBER 31, 1998
 
                                       OR
 
      [ ]   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
        SECURITIES EXCHANGE ACT OF 1934
 
                FOR THE TRANSITION PERIOD FROM           TO           .
 
                       COMMISSION FILE NUMBER: 000-22651
                            ------------------------
 
                             3DFX INTERACTIVE, INC.
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
 
                            ------------------------
 
<TABLE>
<CAPTION>
                         CALIFORNIA                                                   77-0390421
<S>                                                          <C>
              (STATE OR OTHER JURISDICTION OF                          (I.R.S. EMPLOYER IDENTIFICATION NUMBER)
               INCORPORATION OR ORGANIZATION)
 
              4435 FORTRAN DRIVE, SAN JOSE, CA                                          95134
          (ADDRESS OF PRINCIPAL EXECUTIVE OFFICE)                                     (ZIP CODE)
</TABLE>
 
       REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (408) 935-4400
                            ------------------------
 
        SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT: NONE
          SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
 
                           COMMON STOCK, NO PAR VALUE
                        PREFERRED SHARE PURCHASE RIGHTS
                                (TITLE OF CLASS)
 
     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.  Yes  [X]  No  [ ]
 
     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
Amendment to this Form 10-K.  [X]
 
     The aggregate market value of the voting stock held by affiliates of the
registrant, based upon the closing sale price of the Common Stock on February
24, 1999 as reported on the Nasdaq National Market, was approximately
$28,385,025. Shares of Common Stock held by each officer and director and by
each person known to 3Dfx Interactive, Inc. who owns 5% or more of the
outstanding Common Stock have been excluded in that such persons may be deemed
to be affiliates. This determination of affiliate status is not necessarily a
conclusive determination for other purposes.
 
     As of February 1, 1999, registrant had outstanding 15,773,574 shares of
Common Stock.
 
                   DOCUMENTS INCORPORATED BY REFERENCE: None
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>   2
 
                                    PART II
 
ITEM 7.MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
       OF OPERATIONS
 
     The following Management's Discussion and Analysis of Financial Condition
and Results of Operations contains forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. These statements include the
sentence in the first paragraph under "Overview" regarding anticipated revenue
growth; the sentences in the second paragraph under "Overview" regarding
availability of Voodoo3; the sentences in the second and third paragraphs under
"Overview" regarding expected customer concentration and customer loss; the
sentence in the third paragraph under "Overview" regarding availability of raw
materials; the sentences in the third paragraph under "Results of Operations"
regarding factors affecting gross margin; the sentences in the fourth and fifth
paragraphs under "Results of Operations" regarding future research and
development and selling, general and administrative costs, respectively; the
sentences under the subheading "Year 2000 Compliance" regarding the year 2000
issue; the sentence in the second paragraph under "Liquidity and Capital
Resources" regarding capital expenditures; the statements in the fourth
paragraph under "Liquidity and Capital Resources" regarding future liquidity and
capital requirements and the statements below under "Factors Affecting Future
Operating Results." These forward-looking statements are based on current
expectations and entail various risks and uncertainties that could cause actual
results to differ materially from those projected in the forward-looking
statements. Such risks and uncertainties are set forth below under "Factors
Affecting Future Operating Results."
 
OVERVIEW
 
     3Dfx Interactive, Inc. was founded in August 1994 to design, develop,
market and support 3D media processors, subsystems and API software for the
interactive electronic entertainment market. 3Dfx had no operations during the
period from inception (August 24, 1994) through December 31, 1994. 3Dfx was
considered a development stage enterprise and was primarily engaged in product
development and product testing until its first commercial product shipments in
the third quarter of 1996. 3Dfx incurred net losses in every quarter since
inception until the fourth quarter of fiscal 1997 and each quarter in fiscal
1998. 3Dfx incurred net losses of approximately $1.7 million and $14.8 million
in 1997 and 1996, respectively. 3Dfx generated net income of $21.7 million in
1998 and had retained earnings of $199,000 at December 31, 1998. The net losses
were attributable to the lack of substantial revenue and continuing significant
costs incurred in the research, development and testing of 3Dfx's products.
Although 3Dfx has experienced revenue growth in recent periods, historical
growth rates will not be sustained and are not indicative of future operating
results. There can be no assurance that significant revenues or profitability
will be sustained or increased on a quarterly or annual basis in the future.
 
     3Dfx derives revenue from the sale of 3D and 3D/2D media processors
designed for use in PCs and coin-op arcade systems. 3Dfx began commercial
shipments of its first 3D graphics product, the Voodoo Graphics chipset, in
September 1996. 3Dfx's second product, the Voodoo Rush chipset, began commercial
shipments in April 1997. 3Dfx's third product, Voodoo2, became commercially
available in March 1998. In August 1998, 3Dfx began shipping Voodoo Banshee,
which is a high performance, full-featured single chip 3D/2D media processor for
the PC and coin-op arcade markets. In November 1998, 3Dfx introduced its Voodoo3
product family of enhanced and more fully-featured, single chip 3D/2D media
processors. 3Dfx expects to begin shipment of the Voodoo3 product family in the
second quarter of 1999.
 
     As a result of 3Dfx's limited operating history and early stage of
development, it has only a limited number of customers. Revenues derived from
sales to Diamond (including its subsidiaries), Creative (including its
subsidiaries) and Elitetron accounted for approximately 32%, 26% and 16% of
revenues, respectively, in 1998. Revenues derived from sales to Diamond and
Elitetron accounted for approximately 37% and 16%, respectively, of revenues in
1997. Revenues derived from sales to Orchid Technology, Diamond and Williams
accounted for approximately 44%, 33% and 11%, respectively, of revenues in 1996.
3Dfx expects that a small number of customers will continue to account for a
substantial portion of its total revenues for the foreseeable future. The loss
of any one of these customers could have a material impact on 3Dfx's results of
operations, cash flows, or financial position. In addition, sales to these
customers can fluctuate and could have a material impact on 3Dfx's revenues and
profitability on a quarterly basis. The announcement and consummation of the
merger between 3Dfx and STB are expected to cause some of 3Dfx's customers to
end or curtail their relationships with the combined company. If the loss of
these customers of 3Dfx is not replaced by sales from the combined company, the
business of the combined company would be greatly harmed. For example, two of
3Dfx's largest customers, Creative Labs and Diamond, compete directly with STB.
In dollars, these customers together accounted for approximately $117.5 million
of 3Dfx's total revenue in 1998. Diamond and Creative Labs compete directly with
STB and new products being developed by
                                        1
<PAGE>   3
 
3Dfx will primarily be sold directly to OEM and retail customers rather than
through Diamond and Creative Labs. As a result, 3Dfx expects that sales to
Diamond and Creative Labs following the merger will be reduced significantly
from prior levels and that these customers will no longer continue to be
significant customers of the combined company. To date, neither Diamond nor
Creative Labs has communicated to 3Dfx that it will terminate the customer
relationship for current products. Because the combined company will be a chip
and board manufacturer that will compete with board manufacturers, 3Dfx has told
existing customers that are board manufacturers, like Diamond and Creative, that
new 3Dfx graphics chips will not be offered for sale to them after the merger.
If the loss of business from current 3Dfx customers cannot be replaced through
the combined company's own add-in-board level products, or if any other major
customer of 3Dfx terminates its relationship with the combined company, the
business of the combined company could be materially harmed.
 
     As part of its manufacturing strategy, 3Dfx leverages the expertise of
third party suppliers in the areas of wafer fabrication, assembly, quality
control and assurance, reliability and testing. This strategy allows 3Dfx to
devote its resources to research and development and sales and marketing
activities while avoiding the significant costs and risks associated with owning
and operating a wafer fabrication facility and related operations. 3Dfx does not
manufacture the semiconductor wafers used for its products and does not own or
operate a wafer fabrication facility. All of 3Dfx's wafers are currently
manufactured by Taiwan Semiconductor Manufacturing Corporation ("TSMC") in
Taiwan. 3Dfx obtains manufacturing services from TSMC on a purchase order basis.
3Dfx provides TSMC with a rolling six month forecast of its supply needs and
TSMC builds to 3Dfx's orders. 3Dfx purchases wafers and die from TSMC. Once
production yield for a particular product stabilizes, 3Dfx pays an agreed price
for wafers meeting certain acceptance criteria pursuant to a "good die" only
pricing structure for that particular product. Until production yield for a
particular product stabilizes, however, 3Dfx must pay an agreed price for wafers
regardless of yield. Such wafer and die purchases constitute a substantial
portion of cost of products revenues once products are sold. TSMC is responsible
for procurement of raw materials used in the production of 3Dfx's products. 3Dfx
believes that raw materials required are readily available. 3Dfx's products are
packaged by two third party subcontractors, Advanced Semiconductor Engineering
Group ("ASE") and Caesar Technology, Inc. All of 3Dfx products are tested by
ASE. Such assembly and testing is conducted on a purchase order basis rather
than under a long-term agreement. All purchases of wafers and assembly and test
services are denominated in U.S. dollars.
 
     In connection with the grant of stock options to employees since inception
(August 1994) through the effective date of 3Dfx's IPO, 3Dfx recorded aggregate
deferred compensation of approximately $1.9 million, representing the difference
between the deemed fair value of the Common Stock for accounting purposes and
the option exercise price at the date of grant. This amount is presented as a
reduction of shareholders' equity and is amortized ratably over the vesting
period of the applicable options. This amortization resulted in charges to
operations of $484,000 (of which $194,000 and $290,000 were recorded in research
and development expenses and selling, general and administrative expenses,
respectively) in each of the years ended December 31, 1998 and 1997, and
$196,000 (of which $50,000 and $146,000 were recorded in research and
development expenses and selling, general and administrative expenses,
respectively) in the year ended December 31, 1996, and will result in charges
over the next 6 quarters aggregating approximately $121,000 per quarter (of
which $48,000 and $73,000 will be recorded in research and development expenses
and selling, general and administrative expenses, respectively).
 
                                        2
<PAGE>   4
 
RESULTS OF OPERATIONS
 
     The following table sets forth certain statement of operations data of 3Dfx
expressed as a percentage of revenue for each of the periods indicated:
 
<TABLE>
<CAPTION>
                                                                 YEAR ENDED
                                                                DECEMBER 31,
                                                              ----------------
                                                              1998       1997
                                                              -----      -----
<S>                                                           <C>        <C>
Revenues....................................................  100.0%     100.0%
Cost of revenues............................................   59.0       51.3
                                                              -----      -----
Gross profit................................................   41.0       48.7
                                                              -----      -----
  Operating expenses:
     Research and development...............................   16.8       28.2
     Selling, general and administrative....................   17.5       25.8
                                                              -----      -----
          Total operating expenses..........................   34.3       54.0
                                                              -----      -----
Income (loss) from operations...............................    6.7       (5.3)
Interest and other income, net..............................    7.8        1.4
Provision for income taxes..................................   (3.8)        --
                                                              -----      -----
Net income (loss)...........................................   10.7%      (3.9)%
                                                              =====      =====
</TABLE>
 
     YEARS ENDED DECEMBER 31, 1998 AND 1997
 
     Revenues. Revenues increased 359.7% from $44.1 million in 1997 to $202.6
million in 1998. Revenues are recognized upon product shipment. Revenues in 1998
were principally attributable to sales of 3Dfx's Voodoo2, Voodoo Banshee and
Voodoo Graphics chipsets. Revenues in 1997 were principally attributable to
sales of 3Dfx's Voodoo Graphics and Voodoo Rush chipsets. In both years, revenue
growth was as a result of increased customer demand for and market acceptance of
these products.
 
     Gross Profit. Gross profit consists of total revenues less cost of
revenues. Cost of revenues consists primarily of costs associated with the
purchase of components, the procurement of semiconductors and printed circuit
board assemblies from 3Dfx's contract manufacturers, labor and overhead
associated with such procurement and warehousing, shipping and warranty costs.
Cost of revenues does not include expenses related to development contract
revenues. Cost of revenues increased 429% from $22.6 million in 1997 to $119.6
million in 1998. Gross profit as a percentage of revenues was 41% and 48.7% in
1998 and 1997, respectively, due to a change in product mix. Given 3Dfx's
limited operating history and limited history of product shipments, 3Dfx
believes that analysis of gross profit as a percentage of total revenues is not
meaningful. 3Dfx's future gross profit will be affected by the overall level of
sales, the mix of products sold in a period, manufacturing yields, and 3Dfx's
ability to reduce product procurement costs.
 
     Research and Development. Research and development expenses consist
primarily of compensation and other expenses related to research and development
personnel, occupancy costs of research and development facilities, depreciation
of capital equipment used in product development and engineering costs paid to
3Dfx's foundries in connection with manufacturing start-up of new products. In
addition, costs associated with development contracts are included in research
and development during 1997. There were no such costs in 1998. Research and
development expenses increased 174.3% from $12.4 million in 1997 to $34 million
in 1998. The increase reflects an increase in non-recurring engineering costs
and engineering personnel costs resulting from the commencement of manufacturing
of prototypes of the Voodoo Banshee chip and the Voodoo3 chipset. 3Dfx expects
to continue to make substantial investments in research and development and
anticipates that research and development expenses will increase in absolute
dollars in future periods, although such expenses as a percentage of total
revenues will fluctuate.
 
     Selling, General and Administrative. Selling, general and administrative
expenses include compensation and benefits for sales, marketing, finance and
administration personnel, commissions paid to independent sales representatives,
tradeshow, advertising and other promotional expenses and facilities expenses.
Selling, general and administrative expenses increased 211.2% from $11.4 million
in 1997 to $35.4 million in 1998. The increase resulted from the addition of
personnel in sales, marketing, finance and administration as 3Dfx expanded
operations, increased commission expenses associated with the commencement of
commercial sales and increased involvement in tradeshow and advertising
activities. 3Dfx expects that selling, general and administrative expenses will
increase in absolute dollars in future periods, although such expenses as a
percentage of total revenues will fluctuate.
 
                                        3
<PAGE>   5
 
     Interest and Other Income, Net. Interest and other income, net increased
from $630,000 in 1997 to $15.9 million in 1998. The increase is primarily
related to a one-time recognition of income as a result of the recent litigation
settlement reached in September 1998 relating to Sega's termination of the
Technology License and Development Agreement (the "Sega Agreement") with 3Dfx in
July 1997. The increase also reflects earnings from higher cash balances
resulting from the completion of 3Dfx's initial public offering in June 1997 and
a public offering in March 1998, partially offset by interest expense on the
outstanding equipment line of credit and capital lease balances.
 
     Provision For Income Taxes. Provision for income taxes was $7.7 million in
1998. 3Dfx recorded no provision for income taxes in 1997 as it incurred losses
during such period. At December 31, 1998, 3Dfx had net operating loss
carryforwards for federal and state income tax purposes of approximately $10.7
million and $9.7 million, respectively, which expire beginning in 2011 and 2001,
respectively. Under the Tax Reform Act of 1986, the amount of and the benefit
from net operating losses that can be carried forward may be impaired in certain
circumstances. Events which may cause changes in 3Dfx's tax carryovers include,
but are not limited to, a cumulative ownership change of more than 50% over a
three year period. The completion of 3Dfx's initial public offering in June 1997
resulted in an annual limitation of 3Dfx's ability to utilize net operating
losses incurred prior to that date. The annual limitation is approximately $5.4
million.
 
     YEARS ENDED DECEMBER 31, 1997 AND 1996
 
     Revenues. Revenues increased 589.7% from $6.4 million in 1996 to $44.1
million in 1997. Revenues in 1997 included $1.8 million of development contract
revenues earned under the Sega Agreement that was terminated by Sega in July
1997. No future revenues will be recognized under the Sega Agreement. Revenues
from product sales are recognized upon product shipment. Revenues in 1997 were
principally attributable to sales of 3Dfx's Voodoo Graphics and Voodoo Rush
chipsets as a result of increased customer demand for and market acceptance of
these products. Substantially all of the revenues in the year ended December 31,
1996 were derived from sale of 3Dfx's Voodoo Graphics chipset, which began
commercial shipments in September 1996 and, to a lesser extent, sale of graphics
subsystems.
 
     Gross Profit. Gross profit consists of total revenues less cost of
revenues. Cost of revenues consists primarily of costs associated with the
purchase of components, the procurement of semiconductors and printed circuit
board assemblies from 3Dfx's contract manufacturers, labor and overhead
associated with such procurement and warehousing, shipping and warranty costs.
Cost of revenues does not include expenses related to development contract
revenues. Cost of revenues increased 341.4% from $5.1 million in 1996 to $22.6
million in 1997. Gross profit as a percentage of revenues was 19.8% and 48.7% in
1996 and 1997, respectively. Cost of product revenues in 1996 reflected
significant prototype and manufacturing start-up expenses incurred in connection
with the initial commercial shipment of the Voodoo Graphics chipset.
 
     Research and Development. Research and development expenses consist
primarily of compensation and other expenses related to research and development
personnel, occupancy costs of research and development facilities, depreciation
of capital equipment used in product development and engineering costs paid to
3Dfx's foundries in connection with manufacturing start-up of new products. In
addition, costs associated with development contracts are included in research
and development. Research and development expenses increased 31.6% from $9.4
million in 1996 to $12.4 million in 1997. The increase reflects an increase in
non-recurring engineering costs and engineering personnel costs resulting from
the commencement of manufacturing of prototypes of the Voodoo2 chipset and the
Voodoo Banshee chip.
 
     Selling, General and Administrative. Selling, general and administrative
expenses include compensation and benefits for sales, marketing, finance and
administration personnel, commissions paid to independent sales representatives,
tradeshow, advertising and other promotional expenses and facilities expenses.
Selling, general and administrative expenses increased 71.5% from $6.6 million
in 1996 to $11.4 million in 1997. The increase resulted from the addition of
personnel in sales, marketing, finance and administration as 3Dfx expanded
operations, increased commission expenses associated with the commencement of
commercial sales and increased involvement in tradeshow and advertising
activities.
 
     Interest and Other Income, Net. Interest and other income, net increased
from net interest and other income of $59,000 in 1996 to net interest and other
income of $630,000 in 1997. The increase is related to increased earnings from
investments of higher cash balances resulting from the completion of 3Dfx's
initial public offering in June 1997, partially offset by increased interest
expense on outstanding equipment line of credit and capital lease balances.
 
                                        4
<PAGE>   6
 
     Provision For Income Taxes. 3Dfx recorded no provision for income taxes in
1997 and 1996 as it incurred losses during such periods. At December 31, 1997,
3Dfx had net operating loss carryforwards for federal and state income tax
purposes of approximately $18.5 million and $17.5 million, respectively, which
expire beginning in 2010.
 
QUARTERLY RESULTS OF OPERATIONS
 
     The following table sets forth unaudited quarterly results of operations
data for each quarter during the years ended December 31, 1997 and 1998. This
unaudited information has been prepared by 3Dfx on a basis consistent with
3Dfx's audited consolidated financial statements appearing elsewhere in this
Report and includes all adjustments, consisting only of normal recurring
adjustments, necessary for a fair presentation of the information for the
periods presented. The unaudited quarterly information should be read in
conjunction with the Consolidated Financial Statements and Notes thereto
included elsewhere in this Report. In light of 3Dfx's limited operating history,
3Dfx believes that period-to-period comparisons of its financial results are not
necessarily meaningful and should not be relied upon as an indication of future
performance.
 
<TABLE>
<CAPTION>
                                                                           THREE MONTHS ENDED
                                        -----------------------------------------------------------------------------------------
                                        MARCH 31,   JUNE 30,   SEPT. 30,   DEC. 31,   MARCH 31,   JUNE 30,   SEPT. 30,   DEC. 31,
                                          1997        1997       1997        1997       1998        1998       1998        1998
                                        ---------   --------   ---------   --------   ---------   --------   ---------   --------
                                                                             (IN THOUSANDS)
<S>                                     <C>         <C>        <C>         <C>        <C>         <C>        <C>         <C>
Revenues..............................   $ 5,247    $ 6,507     $10,018    $22,297     $50,008    $58,643     $33,206    $60,743
Cost of revenues......................     2,582      3,278       5,352     11,399      25,730     30,443      24,971     38,474
                                         -------    -------     -------    -------     -------    -------     -------    -------
  Gross profit........................     2,665      3,229       4,666     10,898      24,278     28,200       8,235     22,269
                                         -------    -------     -------    -------     -------    -------     -------    -------
Operating expenses:
  Research and development............     1,953      2,397       3,201      4,861       5,826      8,308      10,038      9,873
  Selling, general and
    administrative....................     1,846      2,521       2,684      4,339       9,638      8,041       6,971     10,791
                                         -------    -------     -------    -------     -------    -------     -------    -------
        Total operating expenses......     3,799      4,918       5,885      9,200      15,464     16,349      17,009     20,664
                                         -------    -------     -------    -------     -------    -------     -------    -------
Income (loss) from operations.........    (1,134)    (1,689)     (1,219)     1,698       8,814     11,851      (8,774)     1,605
Interest and other income (expense),
  net.................................       (27)       (64)        347        374         514      1,052      13,045      1,259
Provision for income taxes............        --         --          --         --       1,866      3,871       1,153        773
                                         -------    -------     -------    -------     -------    -------     -------    -------
Net income (loss).....................   $(1,161)   $(1,753)    $  (872)   $ 2,072     $ 7,462    $ 9,032     $ 3,118    $ 2,091
                                         =======    =======     =======    =======     =======    =======     =======    =======
Basic net income (loss) per share.....   $ (0.13)   $ (0.19)    $ (0.07)   $  0.17     $  0.57    $  0.59     $  0.20    $  0.13
Diluted net income (loss) per share...   $ (0.13)   $ (0.19)    $ (0.07)   $  0.15     $  0.50    $  0.54     $  0.20    $  0.13
</TABLE>
 
     Revenues over the last eight quarters were derived primarily from the sale
of the Voodoo Graphics, Voodoo Rush, Voodoo2, and Voodoo Banshee chipsets.
Revenues increased significantly quarter to quarter in 1997 and in 1998, except
for the third quarter ended September 30, 1998, due primarily to increased sales
volumes resulting from increased customer demand for and market acceptance of
these products. In the third quarter of 1998, 3Dfx experienced a significant
reduction in demand as compared to historical order rates for its Voodoo2
chipset, primarily from one customer, as well as a greater than expected
seasonal slowdown, which resulted in a decrease in revenues from the previous
quarter. In the fourth quarter of 1998, significant increases in demand for
3Dfx's new Voodoo Banshee product, combined with a stable demand as compared to
the third quarter of 1998 for its Voodoo2 chipset, resulted in significant
revenue growth in the fourth quarter of 1998 as compared to the previous
quarter. During the three months ended March 31, 1997 and June 30, 1997, 3Dfx
recognized development contract revenues of $750,000 and $1,067,000,
respectively, under the Sega Agreement for the delivery of certain engineering
designs to Sega and revenues recognized under the percentage of completion
method of accounting based on costs incurred relative to total contract costs.
No future revenues will be recognized under the Sega Agreement.
 
     Cost of revenues in 1998 increased in the first, second and fourth quarters
as a result of increased sales in each of these quarters. Additionally, in the
fourth quarter of 1998, costs of revenues increased due to the product revenue
mix during the quarter which carried lower gross margins than historically
experienced. In the third quarter of 1998, cost of revenues decreased when
compared to the previous quarter primarily due to lower revenues, partially
offset by increased costs associated with the initial shipments of the Company's
Voodoo Banshee product, additional overhead costs with respect to lower revenues
as a result of a greater than expected seasonal slowdown in the retail channel,
and to an increase in inventory reserves due to an exceptionally rapid rate of
product lifecycle obsolescence.
 
     Cost of revenues in 1997 reflects significant prototype and manufacturing
start-up expenses incurred in connection with the initial commercial shipments
of Voodoo Graphics and Voodoo Rush. The increase in cost of revenues in the
three months ended June 30, 1997, September 30, 1997 and December 31, 1997
resulted from the increases in sales in each of the respective periods. Cost of
revenues in the three months ended December 31, 1997, includes a $700,000 charge
for the write off of Voodoo2 inventory which was not salable as a result of a
manufacturing defect. Given 3Dfx's limited operating and product shipment
history, 3Dfx believes that quarter to quarter comparisons of gross profit as a
percentage of revenues are not meaningful.
 
                                        5
<PAGE>   7
 
     Research and development expenses increased quarter to quarter in 1998 and
1997 except for the fourth quarter of 1998. In 1998 and 1997, the increase in
research and development expenses in each quarter through September 1998
reflects an increase in headcount, non-recurring engineering costs resulting
from the commencement of manufacturing of the Voodoo Rush, Voodoo2 chipsets and
the Voodoo Banshee and Voodoo3 chips. In the fourth quarter of 1998, research
and development expenses decreased slightly from the previous quarter primarily
due to a reduction in non-recurring engineering costs.
 
     Selling, general and administrative expenses fluctuated quarter to quarter
in 1997 and 1998 primarily as a result of increased finance and administrative
staffing and related costs necessary to support higher levels of operations,
commission expenses associated with levels of revenues and varying levels of
involvement in tradeshow and advertising activities.
 
     Interest and other income (expense), net fluctuated quarter to quarter in
1997 and 1998. The increase in interest and other income in the three months
ended September 30, 1997 and December 31, 1997 is due to interest income earned
on 3Dfx's investments as a result of higher cash balances from the completion of
3Dfx's initial public offering in June 1997, partially offset by interest
expense on outstanding balances under the equipment line of credit and capital
leases. The increase in interest and other income in the three months ended
September 30, 1998 is primarily related to a one-time recognition of income as a
result of the recent Sega litigation settlement, as well as to increased
earnings from higher cash balances resulting from the completion of 3Dfx's
initial public offering in June 1997 and a public secondary offering in March
1998, partially offset by interest expense on the outstanding equipment line of
credit and capital lease balances.
 
     3Dfx believes that, even if it does achieve significant sales of its
products, quarterly and annual results of operations will be affected by a
variety of factors that could materially adversely affect revenues, gross profit
and income from operations. Accordingly, 3Dfx believes that period to period
comparisons of its results of operations should not be relied upon as an
indication of future performance. In addition, the results of any quarterly
period are not indicative of results to be expected for a full fiscal year. In
certain future quarters, 3Dfx's results of operations may be below the
expectations of public market analysts or investors. In such event, the market
price of the Common Stock could be materially adversely affected.
 
IMPACT OF ADOPTION OF NEW ACCOUNTING STANDARDS
 
     In June 1997, the Financial Accounting Standards Board issued Statement No.
130, "Reporting Comprehensive Income" which was adopted by the Company in the
first quarter of fiscal 1998. This Statement establishes standards for reporting
and displaying comprehensive income and its components (revenues, expenses,
gains and losses) in a full set of general-purpose financial statements.
Comprehensive income as defined includes all changes in equity (net assets)
during a period from non-owner sources. Such items may include foreign currency
translation adjustments, unrealized gains/losses from investing and hedging
activities, and other transactions. This Statement requires that all items that
are required to be recognized under accounting standards as components of
comprehensive income be reported in a financial statement that is displayed with
the same prominence as other financial statements. As the Company has no
components of other comprehensive income, there are no disclosure requirements
involved in the Company's adoption of this Statement.
 
     In June 1997, the Financial Accounting Standards Board issued Statement No.
131, "Disclosures about Segments of an Enterprise and Related Information" which
was adopted by the Company in the first quarter of fiscal 1998. This Statement
establishes standards for the way that public business enterprises report
information about operating segments in annual financial statements and requires
that those enterprises report selected information about operating segments in
interim financial reports issued to stockholders. It also establishes standards
for related disclosures about products and services, geographic areas and major
customers. As the Company operates and tracks its results in only one segment,
there are no additional disclosure requirements involved with the Company's
adoption of this Statement.
 
YEAR 2000 COMPLIANCE
 
     Like many other companies, the Year 2000 computer issue creates risks for
3Dfx. If internal systems do not correctly recognize and process date
information beyond the Year 1999, there could be an adverse impact on 3Dfx's
operations. There are two other related issues which could also lead to
incorrect calculations or failures: (1) some systems' programming assigns
special meaning to certain dates, such as 9/9/99, and (2) the Year 2000 is a
leap year. As used in this section, "Year 2000 capable" means that when used
properly and in conformity with the product information provided by the company,
and when used with Year 2000 capable computer systems, the product will
accurately store, display, process, provide, and/or receive data from, into, and
between the twentieth
                                        6
<PAGE>   8
 
and twenty-first centuries, including leap year calculations, provided that all
other technology used in combination with the 3Dfx product properly exchanges
date data with the 3Dfx product.
 
     Internal Systems. To address these Year 2000 issues with its internal
systems, 3Dfx has initiated a program that is designed to deal with 3Dfx's
internal management information systems and its embedded systems (e.g. phones,
and security systems). The program includes both assessment and remediation
proceeding in parallel and 3Dfx currently plans to have changes to those
management and critical systems completed and tested by the third quarter of
1999. These activities are intended to encompass all major categories of systems
used by 3Dfx, including sales and financial systems and embedded systems. The
program has completed its assessment phase, which identified a number of systems
that had date dependencies. None of the systems are considered by 3Dfx to be
mission critical. 95% of the date dependencies have already been remediated. In
almost all cases the fixes involved updating software or firmware. The
unremediated date dependencies involve desktop workstations, and are expected to
be fully remediated by the third quarter of 1999.
 
     Products. 3Dfx has examined all versions of its products and has determined
that its products do not have any date dependencies that could give rise to Year
2000 capability problems. 3Dfx plans to evaluate new products as they are
developed. Because its products have no date dependencies, the Company does not
believe it is legally responsible for costs incurred by customers related to
ensuring their Year 2000 capability.
 
     Suppliers. 3Dfx is also working with key suppliers of products and services
to determine whether their operations and products are Year 2000 capable and to
monitor their progress toward Year 2000 capability. 3Dfx identified three
vendors that could materially impact 3Dfx's business if they experienced
significant Year 2000 problems. These include 3Dfx's supplier of wafer foundry
services and 3Dfx's two suppliers of chip packages. 3Dfx has obtained verbal
assurances from each of these suppliers of services that they comply with
industry standards for Year 2000 readiness. 3Dfx is in the process of
determining whether its three providers of telecommunications services are Year
2000 compliant. This assessment is expected to be completed by the third quarter
of fiscal year 1999.
 
     Costs. The Company is incurring various costs to provide customer support
and customer satisfaction services regarding Year 2000 issues and it is
anticipated that these expenditures will continue through 1999 and thereafter.
The costs incurred to date related to 3Dfx's Year 2000 assessment and
remediation programs have not been material. The cost which will be incurred by
3Dfx regarding the implementation of Year 2000 compliant internal information
systems, answering and responding to customer requests related to Year 2000
issues, including both incremental spending and redeployed resources, is
currently not expected to exceed $300,000. The total cost estimate does not
include potential costs related to any customer or other claims or the cost of
internal software and hardware replaced in the normal course of business. In
some instances, the installation schedule of new software and hardware in the
normal course of business is being accelerated to also afford a solution to Year
2000 capability issues. The total cost estimate is based on the current
assessment of the projects and is subject to change as the project progress.
Based on currently available information, management does not believe that the
Year 2000 matters discussed above related to internal information technology or
embedded systems of key suppliers' systems or products sold to customers will
have a material impact on 3Dfx's financial condition or overall trends in
results of operations. However, 3Dfx cannot guarantee that the year 2000
situation will not negatively impact the Company. In addition, the failure to
ensure Year 2000 capability by a supplier or another third party could have a
material adverse effect on the Company. 3Dfx's Year 2000 compliance programs
have been conducted internally, without the use independent verification or
validation processes. These assessment and compliance programs have not caused
the deferral by 3Dfx of other information technology projects.
 
     3Dfx's most reasonably likely worst case Year 2000 scenario is that 3Dfx
experiences product procurement delays due to Year 2000 problems. These would
arise because 3Dfx's three major suppliers described above are located outside
of the United States. 3Dfx has not assessed, and may not be able to assess, what
Year 2000 problems may occur with the public infrastructure, including
transportation and export systems, of these countries. Such problems may result
in delays in 3Dfx's procuring products which 3Dfx estimates may be approximately
4 weeks. 3Dfx is in the process of developing a contingency plan to address this
scenario. This plan will include the maintenance of a 3 to 6 week safety supply
of product. 3Dfx expects this contingency plan to be in place by the fourth
quarter of fiscal 1999.
 
     The Company has begun internal discussions concerning contingency planning
to address potential problem areas with internal systems and with suppliers and
other third parties. It is expected that assessment, remediation and contingency
planning activities will be ongoing throughout 1999 with the goal of
appropriately resolving all material internal systems and third party issues.
 
                                        7
<PAGE>   9
 
LIQUIDITY AND CAPITAL RESOURCES
 
     Net cash provided by operating activities in fiscal 1998 was due primarily
to net income of $21.7 million, and increases of $28.5 million in accounts
payable and $13.3 million in accrued liabilities, partially offset by increases
of $20.1 million in inventory due to the increase in manufacturing to meet
customer demand and $24.9 million in accounts receivable associated with the
generation of revenues. Net cash used in operating activities in fiscal 1997 was
due primarily to the net loss of $1.7 million, a $12.2 million increase in
accounts receivable partially offset by a $10.3 million increase in accounts
payable.
 
     Net cash used in investing activities was approximately $10.9 million in
1998 and $10.7 million in 1997 and was due in each period to the net maturities
and purchases of investments and to the purchase of property and equipment. 3Dfx
does not have any significant capital spending or purchase commitments other
than normal purchase commitments and commitments under leases. As of December
31, 1998, 3Dfx had capital equipment of $24.1 million less accumulated
depreciation of $8.5 million to support its research and development, operations
and administrative activities. 3Dfx has financed approximately $2.5 million of
its capital equipment from capital lease obligations through December 31, 1998.
3Dfx has an equipment line of credit which provides for the purchase of up to
$3.0 million of property and equipment. At December 31, 1998, there were no
borrowings outstanding under this line of credit. Borrowings under this line are
secured by all of 3Dfx's owned assets and bear interest at the bank's prime rate
plus 0.75% per annum (8.5% as of December 31, 1998). The agreement requires that
3Dfx maintain certain financial ratios and levels of tangible net worth
profitability and liquidity. 3Dfx was in compliance with its covenants as of
December 31, 1998. The lease line of credit expires in December 2001. 3Dfx
expects capital expenditures to increase over the next several years as it
expands facilities and acquires equipment to support the planned expansion of
its operations.
 
     Net cash provided by financing activities was approximately $58.1 million
in 1998 and $34.6 million in 1997, due primarily to proceeds from the public
offering in March 1998 and proceeds from the initial public offering in June
1997.
 
     3Dfx's future liquidity and capital requirements will depend upon numerous
factors, including the costs and timing of the expansion of research and product
development efforts and the success of these development efforts, the costs and
timing of expansion of sales and marketing activities, the extent to which
3Dfx's existing and new products gain market acceptance, competing technological
and market developments, the costs involved in maintaining and enforcing patent
claims and other intellectual property rights, available borrowings under line
of credit arrangements and other factors. 3Dfx believes that the proceeds from
its March 1998 public offering, 3Dfx's current cash balances and cash generated
from operations and from available or future debt financing will be sufficient
to meet 3Dfx's operating and capital requirements through at least December
1999. However, there can be no assurance that 3Dfx will not require additional
financing within this time frame. 3Dfx's forecast of the period of time through
which its financial resources will be adequate to support its operations is a
forward-looking statement that involves risks and uncertainties, and actual
results could vary. The factors described earlier in this paragraph will impact
3Dfx's future capital requirements and the adequacy of its available funds. 3Dfx
may be required to raise additional funds through public or private financing,
strategic relationships or other arrangements. There can be no assurance that
such additional funding, if needed, will be available on terms attractive to
3Dfx, or at all. Furthermore, any additional equity financing may be dilutive to
shareholders, and debt financing, if available, may involve restrictive
covenants. Strategic arrangements, if necessary to raise additional funds, may
require 3Dfx to relinquish its rights to certain of its technologies or
products. The failure of 3Dfx to raise capital when needed could have a material
adverse effect on 3Dfx's business, financial condition and results of
operations.
 
FACTORS AFFECTING OPERATING RESULTS
 
  Risks Related to the Merger with STB Systems, Inc.
 
     The proposed merger of STB Systems, Inc. with and into a wholly-owned
subsidiary of 3Dfx, which will result in STB becoming a wholly-owned subsidiary
of 3Dfx, involves some specific risks, including the following:
 
     - 3Dfx and STB may encounter substantial difficulties integrating the two
       companies' products, technologies, research and development activities,
       administration, sales and marketing and other aspects of operations in a
       timely manner. The difficulties, costs and delays involved in this
       integration may increase operating costs, cause lower than anticipated
       financial performance or lead to the loss of customers and employees. The
       failure to successfully integrate 3Dfx and STB in a timely manner could
       result in a failure of the combined company to realize any of the
       anticipated benefits of the Merger and could materially harm the business
       of the combined company.
 
                                        8
<PAGE>   10
 
     - 3Dfx and STB may lose customers or suppliers as a result of the Merger.
       In particular, two of 3Dfx's largest customers, Creative and Diamond,
       compete directly with STB. During 1998, sales to Diamond (and its
       subsidiaries) and Creative (and its subsidiaries) represented 32% and 26%
       of 3Dfx's total revenue, respectively. 3Dfx expects that as a result of
       the Merger, sales to Diamond and Creative will be reduced significantly
       from prior levels and that such customers may no longer continue to be
       significant customers of the combined company. In addition, nVidia
       Corporation ("nVidia"), which is a major supplier of STB and whose
       graphics chips were incorporated into STB products, representing 63.9% of
       STB's net sales in fiscal 1998, competes directly with 3Dfx. If nVidia
       reduces its supply of graphics chips, the combined company may lose sales
       to those OEM customers that require the nVidia graphics processor for
       their systems. See "Overview" above.
 
     - The combined company will be dependent on a limited source of chips and
       boards because both companies will be more restricted in their ability to
       select products produced by either STB's or 3Dfx's competitors. If either
       3Dfx's chips or STB's boards fail to meet the requirements of either
       company's customers, the business of the combined company could be
       materially harmed.
 
     - A significant component of the near-term success of the combined company
       will be continued success in the retail sales channels and there are
       significant risks associated with the combined company's dependence on
       near-term revenues in this channel.
 
     - The Merger will result in substantial dilution of approximately 34% to
       current 3Dfx shareholders. After the Merger, the current shareholders of
       3Dfx will own approximately 66% of the outstanding shares of 3Dfx common
       stock.
 
     - The combined company's success following the Merger will depend on the
       retention and integration of key personnel.
 
     - If the Merger is consummated, 3Dfx will issue to shareholders of STB an
       aggregate of approximately 8,193,800 shares of 3Dfx Common Stock (based
       on the number of shares of STB Common Stock outstanding as of December
       31, 1998), almost all of which will be freely tradable upon consummation
       of the Merger. As a result, immediately after the Merger, substantial
       sales of 3Dfx Common Stock could occur, which could adversely affect or
       cause substantial fluctuations in the market price of 3Dfx Common Stock.
 
     - There will be substantial expenses resulting from the STB Merger of
       approximately $4.5 million.
 
     - The closing of the merger is subject to certain conditions that might not
       be satisfied in a timely manner, which could prevent the merger from
       being consummated.
 
In addition, in the event of the consummation of the Merger, there are a number
of risks related to the business and operations of STB that would affect the
operations of the combined company, including a number of the same or similar
risks faced by 3Dfx identified below, as well as a number of risks specific to
STB, including STB's dependence on a sole manufacturing facility, STB's
dependence on suppliers, its entry into new product markets, fluctuations in its
products or sales channel mix, and risks relating to environmental regulations.
In the event that the merger is not consummated, 3Dfx will face other risks,
including the opportunity costs associated with the pursuit of a business
combination with STB.
 
  The Quarterly Operating Results of 3Dfx May Fluctuate
 
     3Dfx's quarterly and annual results of operations have varied significantly
in the past and are likely to continue to vary in the future. These variations
are the result of a number of factors, many of which are beyond 3Dfx's control.
These factors include:
 
     - The ability to successfully develop, introduce and market new or enhanced
       products
 
     - The ability to introduce and market products in accordance with customer
       design requirements and design cycles
 
     - Changes in the relative volume of sales of various products with
       different margins
 
     - Changes in demand for 3Dfx's products and its customers' products
 
     - Gains or losses of significant customers or strategic relationships
 
     - The volume and timing of customer orders
 
     - The availability, pricing and timeliness of delivery of components for
       3Dfx's products
                                        9
<PAGE>   11
 
     - The timing of new product announcements or introductions by competitors
 
     - Product obsolescence, the management of product transitions
 
     - Production delays
 
     - Decreases in the average selling prices of products
 
     Any one or more of the factors listed above or other factors could cause
3Dfx to fail to achieve its revenue and profitability expectations. Most of
3Dfx's operating expenses are relatively fixed in the short term. 3Dfx may be
unable to rapidly adjust spending to compensate for any unexpected sales
shortfall, which could materially harm quarterly operating results. As a result
of the above factors, 3Dfx believes that you should not rely on period-to-
period comparisons of results of operations as an indication of future
performance. The results of any one quarter are not indicative of results to be
expected for a full fiscal year.
 
  3Dfx Has a Limited Operating History
 
     3Dfx has been shipping products only since the third quarter of 1996. This
limited operating history makes the assessment of 3Dfx's future operating
results difficult. Additionally, 3Dfx incurred net losses of approximately $1.7
million in 1997 and $14.8 million in 1996. These net losses were attributable to
the lack of substantial sales and to continuing significant costs incurred in
product research, development and testing. Although 3Dfx had net income of $21.7
million in 1998, historical growth rates may not be sustained. Additionally,
significant revenues or profitability may not be sustained or increased on a
quarterly or annual basis in the future.
 
  3Dfx Faces Intense Competition
 
     The markets in which 3Dfx compete are intensely competitive and are likely
to become more competitive in the future. Existing competitors and new market
entrants may introduce products that are less costly or provide better
performance or features than 3Dfx's products. 3Dfx does not compete on the basis
of price alone. 3Dfx believes that the principal competitive factors for 3D
graphics products are:
 
     - Product performance and quality
 
     - Conformity to industry standard application programming interfaces, or
       APIs
 
     - Access to customers and distribution channels
 
     - Price
 
     - Product support
 
     - Ability to bring new products to the market in a timely way
 
     Many of 3Dfx's current and potential competitors have substantially greater
financial, technical, manufacturing, marketing, distribution and other resources
than 3Dfx. These competitors may also have greater name recognition and market
presence, longer operating histories, lower cost structures and larger customer
bases than 3Dfx. As a result, such competitors may be able to adapt more quickly
to new or emerging technologies and changes in customer requirements. In
addition, certain of 3Dfx's principal competitors offer a single vendor
solution, because they maintain their own semiconductor foundries and may
therefore benefit from certain capacity, cost and technical advantages.
 
     3Dfx seeks to use strategic relationships to augment their capabilities.
However, the benefits of these relationships may not be realized or sufficient
to overcome the established positions of 3Dfx's largest competitors as suppliers
to the PC OEM and retail markets. Regardless of the relative qualities of 3Dfx's
products, the market power, product breadth and customer relationships of its
larger competitors can be expected to provide such competitors with substantial
competitive advantages.
 
     3Dfx competes primarily against companies that typically have operated in
the PC 2D graphics market and that now offer 3D capability as an enhancement to
their 2D solutions. These competitors include ATI Technologies, Inc., S3
Incorporated and Trident Microsystems, Inc. Many of these competitors have
introduced 3D functionality on new iterations or existing graphics chips. 3Dfx
also competes with companies that have recently entered the market with an
integrated 3D/2D solution but which have not traditionally manufactured 2D
solutions. These competitors include 3Dlabs, Inc., Ltd., nVidia Corporation and
Micron Technology, Inc. 3Dfx also competes with Videologic Group Plc which has
partnered with NEC to focus exclusively on developing a 3D solution for the
interactive electronic entertainment market. 3Dfx also faces potential
competition from companies that have
 
                                       10
<PAGE>   12
 
focused on the high-end of the 3D market and the production of 3D systems
targeted for the professional engineering market. These competitors include
3Dlabs, Integraph Corporation, Real 3D, an operating unit of Lockheed Martin
Corp., and Silicon Graphics, Inc. These companies are developing lower cost
versions of their 3D technology to bring workstation-like 3D graphics to
mainstream applications. Additionally, Intel has recently entered the 3D
graphics market, targeting its efforts at the mainstream PC market. These
companies may enter the interactive electronics entertainment market and, if
they do, 3Dfx may not be able to compete successfully against them.
 
  3Dfx Depends on the PC Market
 
     For 1996, 1997 and 1998, 82%, 93% and 100% of 3Dfx's revenues were derived
from graphics chips sold for use in PCs. 3Dfx expects to continue to derive
almost all of their revenues from the sales of products for use in PCs. The PC
and graphics chips industries are cyclical and have been characterized by:
 
     - Rapid technological change
 
     - Evolving industry standards
 
     - Cyclical market patterns
 
     - Frequent new product introductions and short product life cycles
 
     - Significant price competition and price erosion
 
     - Fluctuating inventory levels
 
     - Alternating periods of over-capacity and capacity constraints
 
     - Variations in manufacturing costs and yields
 
     - Significant expenditures for capital equipment and product development
 
     The PC and graphics chips markets have also grown substantially in recent
years. However, such growth may not continue. A decline in PC or semiconductor
sales or in the growth rate of such sales would likely reduce demand for 3Dfx's
products. Moreover, such changes in demand could be large and sudden. Since
graphics board and PC manufacturers often build inventories during periods of
anticipated growth, they may be left with excess inventories if growth slows or
if they have incorrectly forecasted product transitions. In such cases, the
manufacturers may abruptly stop purchasing additional inventory from suppliers
such as 3Dfx until the excess inventory has been used. Such suspension of
purchases or any reduction in demand for PCs generally, or for particular
products that incorporate 3Dfx's products, would materially harm 3Dfx's
business.
 
     In addition, the PC and graphics chips industries have in the past
experienced significant economic downturns at various times, characterized by
lower product demand and accelerated reduction of product prices. 3Dfx may
experience substantial period-to-period fluctuations in results of operations
due to general semiconductor industry conditions.
 
  3Dfx Depends on the Retail Distribution Channel
 
     3Dfx's products are distributed primarily in the retail distribution
channel. To access the retail channel, 3Dfx depends on graphics board
manufacturers whose products are sold to consumers. These graphics board
manufacturers generally are not contractually required to make future purchases
of 3Dfx's products and can stop including 3Dfx's products or their graphics
boards for any reason. Heavy reliance on these graphics board manufacturers
makes it difficult for 3Dfx to ascertain current demand for its existing
products and anticipate demand for newly introduced products. The manufacturers
have, in the past, been subject to product allocation by 3Dfx and as a result
may overstate their needs for 3Dfx's products in order to ensure an adequate
supply. In addition, the manufacturers may overestimate consumer demand for
their graphics boards. Also, initial orders for a new product may be the result
of interest by the graphics board manufacturers and not an indication of
long-term consumer demand. If a significant number of graphics board
manufacturers were to experience financial difficulties, or otherwise become
unable or unwilling to promote, sell or pay for 3Dfx's products, 3Dfx's business
could be materially harmed.
 
  3Dfx Faces the Challenge of Growth
 
     3Dfx has experienced rapid growth and may continue to experience such
growth. Growth has placed, and is expected to continue to place, a significant
strain on 3Dfx's managerial, operational and financial resources, including
their sales, customer support, research and development, and finance and
administrative operations.
 
                                       11
<PAGE>   13
 
Although some new controls, systems and procedures have been implemented, 3Dfx's
future growth, if any, will depend on its ability to continue to implement and
improve operational, financial and management information and control systems on
a timely basis, together with maintaining effective cost controls, and any
failure to do so could inhibit growth and harm the company.
 
  3Dfx Depends on New Product Development
 
     The markets for which 3Dfx's products are designed are intensely
competitive and are characterized by short product life cycles, rapidly changing
technology, evolving industry standards and declining average selling prices.
3Dfx's businesses will depend to a significant extent on their ability to
successfully develop new products. As a result, 3Dfx believes that significant
expenditures for research and development will continue to be required in the
future. To succeed in this environment 3Dfx must anticipate the features and
functionality that customers will demand. 3Dfx must then incorporate those
features and functionality into products that meet the design requirements of
the PC market and the timing requirements of retail selling seasons. The success
of 3Dfx's new product introductions will depend on several factors, including:
 
     - Proper new product definition
 
     - Timely completion and introduction of new product designs
 
     - The ability of subcontractors and component manufacturers to effectively
       design and implement the manufacture of new products
 
     - Quality of new products
 
     - Product performance as compared to competitors' products
 
     - Market acceptance of 3Dfx's and their customers' products
 
     - Competitive pricing of products
 
     - Introduction of new products to the market within the limited time window
       for OEM design cycles and retail selling seasons
 
     As the markets for 3Dfx's products continue to develop and competition
increases, we anticipate that product life cycles will shorten and average
selling prices will decline. In particular, average selling prices and, in some
cases, gross margins for 3Dfx's products will decline as products mature. Thus,
3Dfx will need to introduce new products to maintain average selling prices and
gross margins. To do this, 3Dfx must successfully identify new product
opportunities and develop and bring new products to market in a timely manner.
 
     3Dfx has in the past experienced delays in completing development and
introduction of new products. The failure of 3Dfx to successfully develop and
introduce new products and achieve market acceptance for such products would
materially harm 3Dfx's business.
 
  3Dfx's Products Have Short Product Life Cycles; 3Dfx Must Successfully Manage
Product Transitions
 
     3Dfx's products have short product life cycles. The life cycles of 3Dfx's
graphics chips typically range from six to nine months. A failure by 3Dfx to
successfully introduce new products within a given product cycle could
materially harm its business for that cycle and possibly for subsequent cycles.
Any such failure could also damage 3Dfx's brand name, reputation and
relationships with their customers and cause longer term harm to their business.
 
     The PC market frequently undergoes transitions in which products rapidly
incorporate new features and performance standards on an industry-wide basis.
3Dfx's products must be able to support the new features and performance levels
being required by PC manufacturers at the beginning of such a transition.
Otherwise, 3Dfx would likely lose business as well as the opportunity to compete
for new design contracts until the next product transition. Failing to develop
products with required features and performance levels or a delay as short as a
few months in bringing a new product to market could significantly reduce 3Dfx's
revenues for a substantial period.
 
     The success of 3Dfx depends upon continued market acceptance of its
existing products, and its ability to continually develop and introduce new
products and features and product enhancements to meet changing customer
requirements. Each new product cycle presents new opportunities for competitors
of 3Dfx to gain market share.
 
     There are long lead times for certain components used in 3Dfx's products.
Therefore, 3Dfx may not be able to quickly reduce its production or inventory
levels in response to unexpected shortfalls in sales or, conversely, to increase
production in response to unexpected demand. 3Dfx's existing products may not
continue to be accepted by
 
                                       12
<PAGE>   14
 
their markets and 3Dfx may not be successful in enhancing its existing products
or identifying, developing, manufacturing or marketing new products. Delays in
developing new products or product enhancements or the failure of such products
or product enhancements to gain market acceptance would materially harm 3Dfx's
businesses.
 
  3Dfx Has Significant Customer Concentration
 
     3Dfx's sales are highly concentrated among a limited number of customers.
Revenues derived from sales to Diamond (and its subsidiaries), Creative (and its
subsidiaries) and Elitetron accounted for approximately 32%, 26% and 16% of
revenues in 1998 and revenues derived from sales to Diamond and Elitetron
accounted for approximately 37% and 16% of revenues for 1997. 3Dfx expects that
a small number of customers will continue to account for a substantial portion
of their revenues for the foreseeable future.
 
     All of 3Dfx's sales were made pursuant to purchase orders. This lack of
long-term commitments, together with the customer concentration noted above,
pose a significant risk. If a single customer of 3Dfx cancels an order or ceases
to be a customer, 3Dfx's business and financial condition could be materially
harmed. In addition, if the merger with STB is consummated, 3Dfx expects to lose
several of its current customers. See "Overview" above for a fuller discussion
of the effect of the merger on 3Dfx's customer base.
 
  3Dfx Has Significant Product Concentration
 
     3Dfx's revenues are dependent on the markets for 3D/2D and 3D media
processors for PCs and on 3Dfx's ability to compete in that market. Since 3Dfx
has no other products, 3Dfx's business would be materially harmed if it were
unsuccessful in selling these media processors.
 
     3Dfx Depends on Independent Manufacturers and Other Third Parties; 3Dfx Has
No Manufacturing Capacity
 
     3Dfx's products require wafers manufactured with state-of-the-art
fabrication equipment and techniques. 3Dfx does not manufacture the
semiconductor wafers used for its products and does not own or operate a wafer
fabrication facility. Taiwan Semiconductor Manufacturing Company, or TSMC,
currently manufactures all of 3Dfx's wafers in Taiwan. 3Dfx obtains
manufacturing services from TSMC on a purchase order basis. 3Dfx depends on TSMC
to:
 
     - Produce wafers of acceptable quality and with acceptable manufacturing
       yields
 
     - Deliver those wafers to 3Dfx and its independent assembly and testing
       subcontractors on a timely basis
 
     - Allocate to 3Dfx a portion of their manufacturing capacity sufficient to
       meet 3Dfx's needs
 
     3Dfx expects to continue to be dependent upon TSMC in the future.
 
     3Dfx has no readily available alternative source of supply and it could
take several months to establish a strategic relationship with a new
manufacturing partner. Therefore, a manufacturing disruption experienced by TSMC
would impact the production of 3Dfx's products for a substantial period of time.
Additionally, TSMC fabricates wafers for other companies and could choose to
prioritize capacity for other uses or reduce or eliminate deliveries to 3Dfx on
short notice. Any disruption in 3Dfx's access to TSMC's production capacity
would materially harm 3Dfx's business.
 
     There are many other risks associated with 3Dfx's dependence upon third
party manufacturers, including:
 
     - Reduced control over delivery schedules, quality assurance, manufacturing
       yields and cost
 
     - The potential lack of adequate capacity during periods of excess demand
 
     - Limited warranties on wafers supplied to 3Dfx
 
     - Potential misappropriation of 3Dfx's intellectual property
 
     3Dfx's products are packaged and tested by two third party subcontractors
on a purchase order basis rather than under a long-term agreement. As a result
of its reliance on these subcontractors to assemble and test its products, 3Dfx
cannot directly control product delivery schedules. This could lead to product
shortages or quality assurance problems that could increase the costs of
manufacturing or assembly of 3Dfx's products. A significant amount of time is
required to qualify assembly and test subcontractors. Therefore, product
shipments could be delayed significantly if 3Dfx is required to find alternative
subcontractors. Any problems associated with the delivery, quality or cost of
the assembly and testing of 3Dfx's products could materially harm 3Dfx's
business.
 
                                       13
<PAGE>   15
 
  Semiconductor Manufacturers Experience Manufacturing Yield Problems
 
     The fabrication of semiconductors is a complex and precise process that
often experiences problems that are difficult to diagnose and time consuming or
expensive to solve. As a result, semiconductor companies often experience
problems in achieving acceptable wafer manufacturing yields. These yields
reflect the number of good die as a proportion of the total number of die on any
particular wafer. Once production yields for a product stabilize, 3Dfx pays an
agreed price for wafers meeting certain acceptance criteria pursuant to a "good
die" only pricing structure for that product. Until production yields for a
product stabilize, however, 3Dfx must pay an agreed price for wafers regardless
of yield. Accordingly, in this latter circumstance, 3Dfx bears the risk of final
yield of good die. Poor yields would materially harm 3Dfx's business.
 
     Semiconductor manufacturing yields are a function of both product design,
which is developed largely by 3Dfx, and process technology, which is typically
proprietary to the manufacturer. Low yields may result from either design or
process technology failure. Thus, yield problems may not be determined or
resolved until an actual product exists that can be analyzed and tested to
identify process sensitivities relating to the design rules that are used. As a
result, yield problems may not be identified until well into the production
process. At that point, resolution of yield problems would require cooperation
by and communication between 3Dfx and the manufacturer. The offshore location of
3Dfx's manufacturer compounds this risk because it increases the effort and time
required to identify, communicate and resolve manufacturing yield problems. As
3Dfx's relationships with TSMC and any additional manufacturing partners
develop, yields could be harmed from difficulties in adapting 3Dfx's technology
and product design to the proprietary process technology and design rules of
each manufacturer.
 
     3Dfx's manufacturers may not achieve or maintain acceptable manufacturing
yields in the future. Because of 3Dfx's potentially limited access to wafer
fabrication capacity from its manufacturers, any decrease in manufacturing
yields could result in an increase in 3Dfx's per unit costs and force 3Dfx to
allocate its available product supply among its customers. Such an allocation
could potentially adversely impact customer relationships as well as revenues
and gross profit. Any inability of 3Dfx to achieve planned yields from its
manufacturers could materially harm 3Dfx's business, 3Dfx also faces the risk of
product recalls resulting from design or manufacturing defects which are not
discovered during the manufacturing and testing process. In the event of a
significant number of product returns due to a defect or recall, 3Dfx's revenues
and gross profit could be materially harmed.
 
  3Dfx Faces Risks Relating to Intellectual Property
 
     3Dfx relies primarily on a combination of patent, mask work protection,
trademarks, copyrights, trade secret laws, employee and third-party
nondisclosure agreements and licensing arrangements to protect its intellectual
property. If these efforts are not sufficient to protect 3Dfx's intellectual
property, 3Dfx's business may be harmed. Many foreign jurisdictions offer less
protection of intellectual property rights than the United States. Therefore,
the protection provided to 3Dfx's proprietary technology by the laws of foreign
jurisdictions may not be sufficient to protect its technology.
 
     The semiconductor industry is characterized by vigorous protection and
pursuit of intellectual property rights or positions and it is common in the PC
industry for companies to assert intellectual property infringement claims
against other companies. Therefore, 3Dfx's products may become the target of
infringement claims. If that were to occur, 3Dfx may be required to spend
significant time and money to defend its products, redesign its products or
develop or license a substitute technology. Any of these events could materially
harm 3Dfx's business. Litigation by or against 3Dfx could result in significant
expense to 3Dfx and could divert the efforts of 3Dfx's technical and management
personnel, regardless of the outcome of such litigation.
 
  3Dfx's International Operations Are Subject to Certain Risks
 
     3Dfx relies on foreign third-party manufacturing, assembly and testing
operations which are located in Asia. In addition, 3Dfx has significant export
sales. These international operations subject 3Dfx to a number of risks
associated with conducting business outside of the United States. These risks
include:
 
     - Unexpected changes in legislative or regulatory requirements
 
     - Delays resulting from difficulty in obtaining export licenses for certain
       technology
 
     - Tariffs, quotas and other trade barriers and restrictions
 
     - Longer accounts receivable payment cycles
 
     - Difficulties in collecting payment
 
                                       14
<PAGE>   16
 
     - Potentially adverse tax consequences, including repatriation of earnings
 
     - Burdens of complying with a variety of foreign laws
 
     - Unfavorable intellectual property laws
 
     - Political instability
 
     - Foreign currency fluctuations
 
     Any of these factors could materially harm the international operations and
sales of 3Dfx, and consequently, its business. Recently, the financial markets
in Asia have experienced significant turmoil, which could harm 3Dfx's
international sales or operations. Currently, all of 3Dfx's product sales and
its arrangements with its foundry and assembly and test vendors provide for
pricing and payment in U.S. dollars. To date, 3Dfx has not engaged in any
currency hedging activities, although 3Dfx may do so in the future. An increase
in the value of the U.S. dollar relative to foreign currencies could make 3Dfx's
products more expensive and potentially less competitive in foreign markets.
 
  3Dfx's Stock Prices May Be Volatile
 
     The trading price of 3Dfx's Common Stock has in the past fluctuated and
could in the future fluctuate significantly. The fluctuations have been or could
be in response to numerous factors, including:
 
     - Quarterly variations in results of operations
 
     - Announcements of technological innovations or new products by 3Dfx, its
       customers or competitors
 
     - Changes in securities analysts' recommendations
 
     - Earnings estimates for 3Dfx
 
     - General fluctuations in the stock market
 
     3Dfx's revenues and results of operations may be below the expectations of
public market securities analysts or investors. This could result in a sharp
decline in the market price of 3Dfx's Common Stock. In addition, stock markets
have from time to time experienced extreme price and volume fluctuations. The
market prices for high technology companies have been particularly affected by
these market fluctuations and such effects have often been unrelated to the
operating performance of such companies. These broad market fluctuations may
cause a decline in the market price of 3Dfx's common stock.
 
     In the past, following periods of volatility in the market price of a
company's stock, securities class action litigation has been brought against the
issuing company. It is possible that similar litigation could be brought against
3Dfx. Such litigation could result in substantial costs and would likely divert
management's attention and resources. Any adverse determination in such
litigation could also subject 3Dfx to significant liabilities.
 
  Risks Associated with Year 2000 Compliance
 
     3Dfx uses a significant number of computer software programs and operating
systems in its internal operations. These include applications used in financial
business systems and various administration functions, and also software
programs in their products. If these software applications are unable to
appropriately interpret dates occurring in the upcoming calendar year 2000, some
level of modification or replacement of such software may be necessary. 3Dfx
believes that all of its existing products are Year 2000 compliant and has
conducted or is conducting Year 2000 compliance testing. Despite such belief,
3Dfx's products may not be Year 2000 compliant. If 3Dfx's products fail to
perform, including failures due to the onset of calendar year 2000, its business
would likely be materially harmed.
 
     3Dfx is currently evaluating its information technology for Year 2000
compliance. This evaluation includes reviewing what actions are required to make
all internally used software systems Year 2000 compliant as well as actions
necessary to make 3Dfx less vulnerable to Year 2000 compliance problems
associated with third parties' systems. Such measures may not solve all of
3Dfx's Year 2000 problems. Any Year 2000 problems could materially harm 3Dfx's
business. In addition, 3Dfx's customers and suppliers may not be year 2000
compliant, which could materially harm 3Dfx's business. See "Year 2000
Compliance" above.
 
  3Dfx Depends on Third Party Developers and Publishers
 
     3Dfx believes that the availability of numerous high quality, commercially
successful software entertainment titles and applications significantly affects
sales of 3D and 3D/2D media processors. 3Dfx depends on third party
 
                                       15
<PAGE>   17
 
software developers and publishers to create, produce and market software titles
that will operate with 3Dfx's 3D and 3D/2D media processor products. Only a
limited number of software developers are capable of creating high quality
entertainment software. Competition for these resources is intense and is
expected to increase. Therefore, a sufficient number of high quality,
commercially successful software titles compatible with 3Dfx's products may not
be developed. In addition, the development and marketing of game titles that do
not fully demonstrate the technical capabilities of 3Dfx's products could create
the impression that 3Dfx's technology offers only marginal performance
improvements, if any, over competing products.
 
     3Dfx's success will be substantially affected by the adoption by software
developers of Glide, its proprietary, low-level 3D API. Although 3Dfx's products
support game titles developed for most industry standard APIs, 3Dfx believes
that Glide currently allows developers to fully exploit the technical
capabilities of 3Dfx's 3D and 3D/2D media processor products. Glide competes
with APIs developed or expected to be developed by other companies having
significantly greater financial resources, marketing power, name recognition and
experience than 3Dfx. For example, certain industry standard APIs, such as
Microsoft's D3D and SGI's OpenGL, have a much larger installed customer base and
a much larger base of existing software titles. Developers may face additional
costs to port games developed on other standard APIs to Glide for play on the
3Dfx's architecture. There can be no assurance that Glide will be adopted by a
sufficient number of software developers or that developers who have used Glide
in the past will continue to do so in the future.
 
                                       16
<PAGE>   18
 
                                    PART IV
 
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
 
  (a)(1) Financial Statements
 
     The following financial statements are filed as part of this Report.
 
<TABLE>
<CAPTION>
                                                              PAGE
                                                              ----
<S>                                                           <C>
Report of Independent Accountants...........................  F-1
Consolidated Balance Sheets as of December 31, 1998 and
  1997......................................................  F-2
Consolidated Statements of Operations for the years ended
  December 31, 1998, 1997 and 1996..........................  F-3
Consolidated Statements of Changes in Shareholders' Equity
  for the years ended December 31, 1998, 1997 and 1996......  F-4
Consolidated Statements of Cash Flows for the years ended
  December 31, 1998, 1997 and 1996..........................  F-5
Notes to Consolidated Financial Statements..................  F-6
</TABLE>
 
  (a)(2) Financial Statement Schedule
 
     The following Financial Statement Schedule of 3Dfx is submitted herewith
     and should be read in conjunction with the Consolidated Financial
     Statements:
 
<TABLE>
<S>                                                           <C>
     Report of Independent Accountants on Financial
      Statement Schedule....................................  S-2
     Schedule II Valuation and Qualifying Accounts for the
      years ended December 31, 1998, 1997 and 1996..........  S-2
</TABLE>
 
  (a)(3) Exhibits.
 
<TABLE>
<CAPTION>
    EXHIBIT NO.                           DESCRIPTION
    -----------                           -----------
    <C>           <S>
     2.1(1)       Agreement and Plan of Reorganization by and between the
                  Registrant and STB Systems, Inc. dated as of December 13,
                  1998 and the related Stock Option Agreement and form of
                  Voting Agreement.
     3.1(2)       Restated Articles of Incorporation of the Registrant.
     3.2(7)       Bylaws of the Registrant (as amended October 1998).
     3.3(5)       Certificate of Designation of Rights Preferences and
                  Privileges of Series A Participating Preferred Stock of
                  Registrant.
     4.1(2)       Specimen Common Stock Certificate.
     4.2(5)       Preferred Shares Rights Agreement dated October 30, 1998,
                  between Registrant and BankBoston, N.A., Rights Agent.
    10.1(2)       Form of Indemnification Agreement between the Registrant and
                  each of its directors and officers.
    10.2(6)       1995 Employee Stock Plan and form of Stock Option Agreement
                  thereunder.
    10.3(2)       1997 Director Option Plan and form of Director Stock Option
                  Agreement thereunder.
    10.4(2)       1997 Employee Stock Purchase Plan and forms of agreement
                  thereunder.
    10.5(2)       Lease Agreement dated August 7, 1996 between Registrant and
                  South Bay/Fortran, and Tenant Estoppel Certificate dated
                  March 25, 1997 between Registrant and CarrAmerica Realty
                  Corporation for San Jose, California office.
    10.6(2)       Investors' Rights Agreement dated September 12, 1996,
                  Amendment No. 1 to Investors' Rights Agreement dated
                  November 25, 1996, Amendment No. 2 to Investors' Rights
                  Agreement dated December 18, 1996 and Amendment No. 3 to
                  Investors' Rights Agreement dated March 27, 1997 by and
                  among the Registrant and holders of the Registrant's Series
                  A, Series B and Series Preferred Stock.
    10.7.1(3)     Warrant to purchase shares of Common Stock issued to
                  Creative Labs, Inc.
    10.7.2(2)     Warrant to purchase shares of Series B Preferred Stock
                  issued to MMC/GATX Partnership No. 1.
    10.8(2)       Form of Restricted Stock Purchase Agreement between the
                  Registrant and certain shareholders.
    10.9(2)       Master Equipment Lease Agreement dated January 1, 1996 by
                  and between the Registrant and MMC/GATX Partnership No. 1.
    10.10(2)      Master Equipment Lease dated March 31, 1995 by and between
                  the Registrant and Lighthouse Capital Partners, L.P.
</TABLE>
 
                                       17
<PAGE>   19
 
<TABLE>
<CAPTION>
    EXHIBIT NO.                           DESCRIPTION
    -----------                           -----------
    <C>           <S>
    10.11.1(3)    Loan and Security Agreement dated August 19, 1996 by and
                  between the Registrant and Silicon Valley Bank.
    10.11.2(3)    Loan Modification Agreement dated as of August 18, 1997 by
                  and between the Registrant and Silicon Valley Bank.
    10.11.3(3)    Second Amendment and Limited Waiver to Loan and Security
                  Agreement dated as of December 9, 1997 by and between the
                  Registrant and Silicon Valley Bank.
    10.12.1(2)    Change of Control Letter Agreement between the Registrant
                  and L. Gregory Ballard.
    10.12.2(2)    Change of Control Letter Agreement between the Registrant
                  and Karl Chicca.
    10.12.3(2)    Change of Control Letter Agreement between the Registrant
                  and Scott D. Sellers.
    10.12.4(2)    Change of Control Letter Agreement between the Registrant
                  and Gary Tarolli.
    10.13.+(4)    Software License and Co-marketing Agreement made as of June,
                  1997 by and between Electronic Arts, Inc. and the
                  Registrant.
    10.14(4)      Master Equipment Lease dated July 1, 1997 by and between the
                  Registrant and Pentech Financial Services, Inc.
    10.15(3)      Lease Agreement dated as of January 6, 1998 by and between
                  the Registrant and GEOMAX.
    10.16(3)      Separation Agreement dated as of October 12, 1997 by and
                  between the Registrant and Gary P. Martin.
    10.17(3)      1997 Supplementary Stock Option Plan and Form of Stock
                  Option Agreement thereunder.
    21.1(7)       Subsidiaries of the Registrant.
    23.1          Consent of PricewaterhouseCoopers LLP, Independent
                  Accountants.
    24.1(7)       Power of Attorney.
    27.1(7)       Financial Data Schedule.
</TABLE>
 
---------------
 +  Confidential treatment has been granted for portions of this agreement.
    Omitted portions have been filed separately with the Commission.
 
(1) Incorporated by reference to Schedule 13D filed by STB Systems, Inc. dated
    December 23, 1998 with respect to the Registrant.
 
(2) Incorporated by reference to the exhibits filed with the Registrant's
    Registration Statement on Form S-1 (File No. 333-25365) which was declared
    effective on June 25, 1997.
 
(3) Incorporated by reference to the exhibits filed with the Registrant's
    Registration Statement on Form S-1 (File No. 333-46119) which was declared
    effective March 5, 1998.
 
(4) Incorporated by reference to the exhibits filed with the Registrant's
    Quarterly Report on Form 10-Q for the period ended June 30, 1997.
 
(5) Incorporated by reference to the exhibits filed with the Registrant's
    Registration Statement on Form 8-A which was filed with the Commission on
    November 9, 1998.
 
(6) Incorporated by reference to the exhibits filed with the Registrant's
    Quarterly Report on Form 10-Q for the period ended June 30, 1998.
 
(7) Previously filed.
 
                                       18
<PAGE>   20
 
                                   SIGNATURES
 
     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, the Registrant has duly caused this Amendment
No. 1 to its Annual Report on Form 10-K to be signed on its behalf by the
undersigned, thereunto duly authorized.
 
Date: February 25, 1999                3DFX INTERACTIVE, INC.
 
                                       By:      /s/ L. GREGORY BALLARD
                                         ---------------------------------------
                                         L. Gregory Ballard, President and
                                         Chief Executive Officer
 
     PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED, THIS REPORT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS ON BEHALF OF
THE REGISTRANT AND IN THE CAPACITIES AND ON THE DATES INDICATED:
 
<TABLE>
<CAPTION>
                      SIGNATURE                                      TITLE                       DATE
                      ---------                                      -----                       ----
<S>                                                    <C>                                 <C>
 
/s/ L. GREGORY BALLARD                                 President, Chief Executive Officer  February 25, 1999
-----------------------------------------------------  and Director (Principal Executive
(L. Gregory Ballard)                                   Officer)
 
/s/ DAVID ZACARIAS                                     Vice President, Administration and  February 25, 1999
-----------------------------------------------------  Chief Financial Officer (Principal
(David Zacarias)                                       Financial and Accounting Officer)
 
/s/ GORDON A. CAMPBELL*                                Chairman of the Board               February 25, 1999
-----------------------------------------------------
(Gordon A. Campbell)
 
/s/ ALEX LEUPP*                                        Director                            February 25, 1999
-----------------------------------------------------
(Alex Leupp)
 
/s/ SCOTT D. SELLERS*                                  Director                            February 25, 1999
-----------------------------------------------------
(Scott D. Sellers)
 
/s/ ANTHONY SUN*                                       Director                            February 25, 1999
-----------------------------------------------------
(Anthony Sun)
 
/s/ JAMES WHIMS*                                       Director                            February 25, 1999
-----------------------------------------------------
(James Whims)
 
/s/ PHILIP M. YOUNG*                                   Director                            February 25, 1999
-----------------------------------------------------
(Philip M. Young)
 
               *By: /s/ DAVID ZACARIAS
  ------------------------------------------------
                  (David Zacarias)
                  Attorney-in-Fact
</TABLE>
 
                                       19
<PAGE>   21
 
                             3DFX INTERACTIVE, INC.
 
                               INDEX TO EXHIBITS
 
<TABLE>
<CAPTION>
EXHIBIT NO.                          DESCRIPTION
-----------                          -----------
<S>          <C>
2.1(1)       Agreement and Plan of Reorganization by and between the
             Registrant and STB Systems, Inc. dated as of December 13,
             1998 and the related Stock Option Agreement and form of
             Voting Agreement.
3.1(2)       Restated Articles of Incorporation of the Registrant.
3.2(7)       Bylaws of the Registrant (as amended October 1998).
3.3(5)       Certificate of Designation of Rights Preferences and
             Privileges of Series A Participating Preferred Stock of
             Registrant.
4.1(2)       Specimen Common Stock Certificate.
4.2(5)       Preferred Shares Rights Agreement dated October 30, 1998,
             between Registrant and BankBoston, N.A., Rights Agent.
10.1(2)      Form of Indemnification Agreement between the Registrant and
             each of its directors and officers.
10.2(6)      1995 Employee Stock Plan and form of Stock Option Agreement
             thereunder.
10.3(2)      1997 Director Option Plan and form of Director Stock Option
             Agreement thereunder.
10.4(2)      1997 Employee Stock Purchase Plan and forms of agreement
             thereunder.
10.5(2)      Lease Agreement dated August 7, 1996 between Registrant and
             South Bay/Fortran, and Tenant Estoppel Certificate dated
             March 25, 1997 between Registrant and CarrAmerica Realty
             Corporation for San Jose, California office.
10.6(2)      Investors' Rights Agreement dated September 12, 1996,
             Amendment No. 1 to Investors' Rights Agreement dated
             November 25, 1996, Amendment No. 2 to Investors' Rights
             Agreement dated December 18, 1996 and Amendment No. 3 to
             Investors' Rights Agreement dated March 27, 1997 by and
             among the Registrant and holders of the Registrant's Series
             A, Series B and Series Preferred Stock.
10.7.1(3)    Warrant to purchase shares of Common Stock issued to
             Creative Labs, Inc.
10.7.2(2)    Warrant to purchase shares of Series B Preferred Stock
             issued to MMC/GATX Partnership No. 1.
10.8(2)      Form of Restricted Stock Purchase Agreement between the
             Registrant and certain shareholders.
10.9(2)      Master Equipment Lease Agreement dated January 1, 1996 by
             and between the Registrant and MMC/GATX Partnership No. 1.
10.10(2)     Master Equipment Lease dated March 31, 1995 by and between
             the Registrant and Lighthouse Capital Partners, L.P.
10.11.1(3)   Loan and Security Agreement dated August 19, 1996 by and
             between the Registrant and Silicon Valley Bank.
10.11.2(3)   Loan Modification Agreement dated as of August 18, 1997 by
             and between the Registrant and Silicon Valley Bank.
10.11.3(3)   Second Amendment and Limited Waiver to Loan and Security
             Agreement dated as of December 9, 1997 by and between the
             Registrant and Silicon Valley Bank.
10.12.1(2)   Change of Control Letter Agreement between the Registrant
             and L. Gregory Ballard.
10.12.2(2)   Change of Control Letter Agreement between the Registrant
             and Karl Chicca.
10.12.3(2)   Change of Control Letter Agreement between the Registrant
             and Scott D. Sellers.
10.12.4(2)   Change of Control Letter Agreement between the Registrant
             and Gary Tarolli.
10.13.+(4)   Software License and Co-marketing Agreement made as of June,
             1997 by and between Electronic Arts, Inc. and the
             Registrant.
10.14(4)     Master Equipment Lease dated July 1, 1997 by and between the
             Registrant and Pentech Financial Services, Inc.
10.15(3)     Lease Agreement dated as of January 6, 1998 by and between
             the Registrant and GEOMAX.
10.16(3)     Separation Agreement dated as of October 12, 1997 by and
             between the Registrant and Gary P. Martin.
10.17(3)     1997 Supplementary Stock Option Plan and Form of Stock
             Option Agreement thereunder.
21.1(7)      Subsidiaries of the Registrant.
23.1         Consent of PricewaterhouseCoopers LLP, Independent
             Accountants.
24.1(7)      Power of Attorney.
27.1(7)      Financial Data Schedule.
</TABLE>
 
---------------
 +  Confidential treatment has been granted for portions of this agreement.
    Omitted portions have been filed separately with the Commission.
<PAGE>   22
 
(1) Incorporated by reference to Schedule 13D filed by STB Systems, Inc. dated
    December 23, 1998 with respect to the Registrant.
 
(2) Incorporated by reference to the exhibits filed with the Registrant's
    Registration Statement on Form S-1 (File No. 333-25365) which was declared
    effective on June 25, 1997.
 
(3) Incorporated by reference to the exhibits filed with the Registrant's
    Registration Statement on Form S-1 (File No. 333-46119) which was declared
    effective March 5, 1998.
 
(4) Incorporated by reference to the exhibits filed with the Registrant's
    Quarterly Report on Form 10-Q for the period ended June 30, 1997.
 
(5) Incorporated by reference to the exhibits filed with the Registrant's
    Registration Statement on Form 8-A which was filed with the Commission on
    November 9, 1998.
 
(6) Incorporated by reference to the exhibits filed with the Registrant's
    Quarterly Report on Form 10-Q for the period ended June 30, 1998.
 
(7) Previously filed.