AMD released sections of its third-quarter results performance today, reducing its forecast sales from $6.7 billion to $5.6 billion, a $1.1 billion decrease. AMD also cautioned investors that its non-GAAP gross margin will be 50%, down from 54% previously predicted. Lower-than-expected consumer PC sales and large inventory adjustments in the PC supply chain were noted by the business. It did, however, mention that its data center, gaming, and embedded divisions are still performing well.
AMD’s warning reduces its revenue predictions from 55% to 29% year on year, indicating that the business would continue to thrive despite the challenges. AMD particularly blamed the revenue shortfall on decreased shipments and lower average selling prices (ASPs) for its client processors. This issue has also tormented other semiconductor makers such as Intel and Nvidia owing to rising stockpiles while demand falls.
AMD’s deficit comes after an amazing Q2 performance in which revenue increased 70% year on year as it continues to eat away at Intel’s market share despite sales of desktop CPUs being the lowest in 30 years. However, the company’s Q2 disclosures highlighted possible coming challenges – most analysts thought that the company’s Q3 projection was already below expectations.
