UPDATE 1-AMD forecasts fourth-quarter revenue below estimates

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(Adds share movement, quarterly revenue in last paragraph; background throughout)

Oct 31 (Reuters) – Chip designer Advanced Micro Devices forecast fourth-quarter revenue below Wall Street estimates on Tuesday, hurt by a weak gaming market as well as a decline in demand from some industries for its programmable chips.

Shares of the Santa Clara, California-based company fell 3% in trading after the bell.

While the PC market is in recovery mode, demand for programmable chips used by industries such as healthcare and automotive have slowed down.

Intel last week said it expects demand from that segment to decline and stay down for the “next few” quarters. This would have an impact on AMD’s Xilinx business, which is known for its high margins.

Analysts said the recent expansion of U.S. sanctions on chip exports to Beijing will require AMD to seek licenses to sell its most high-end artificial intelligence chips to China, which it plans to launch and ramp only in the fourth quarter.

Moreover, capital spending cuts by key customer Meta Platforms could also weigh on the company.

The company forecast current-quarter revenue of about $6.1 billion, plus or minus $300 million. Analysts polled by LSEG expect revenue of $6.37 billion.

Adjusted revenue in the third quarter rose 4% to $5.80 billion, compared to estimates of $5.70 billion. (Reporting by Chavi Mehta in Bengaluru; Editing by Krishna Chandra Eluri)

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