You know, an established company simply not being able to compete with its initial release is not out of the realm of possibility.
It kinda happened with the first R500 even though it competition was almost a phantom product(7800GTX 512) and its happening right now with AMD high-end CPU lineup. The worse example was NV30 fx disaster.
GDD4 has been out for far too long to pin it as the cause(the memory itself and not it setup I mean), but another couple months to iron it out and they should be back on their feet. The XT should eat some GTS sales for sure anyways.