Advanced Micro Devices Inc (AMD), Intel Corp’s main competitor in computer processors, said third-quarter sales would be lower than it had predicted, citing weak demand for notebook computers in Europe and North America.
Sales will decline between 1 percent and 4 percent from the US$1.65 billion recorded in the second quarter, Sunnyvale, California-based AMD said on Thursday in a statement.
In July, the company said that sales would rise “seasonally” in the third quarter from the preceding three months.
The announcement follows a similar reduction by Intel, which cited weaker consumer demand in developed markets. The outlook also mirrors warnings from other chipmakers, including Texas Instruments Inc.
AMD, which has been winning market share in notebooks, does not have the presence in servers and business machines to offset the drop in consumer spending, said Hans Mosesmann, an analyst at Raymond James & Associates.
“It was a matter of time after Intel,” said Mosesmann, who is based in St Petersburg, Florida. “After a strong first half, the prospects of getting to normal seasonality was tough.”
Under the new forecast, sales this quarter would be US$1.63 billion at most. That compares with the US$1.71 billion average of estimates in a Bloomberg survey compiled before Thursday’s announcement.
On Aug. 27, Intel, the world’s biggest chipmaker, cut its third-quarter revenue forecast, citing weaker-than-expected consumer demand for personal computers in mature markets.
That lower forecast highlighted a divergence between consumers, who are increasingly tightening belts, and companies, which lifted demand for computers and other technology gear.
Intel said purchasing by business customers will keep gross margins from declining from the near-record 66 percent it is predicting for the third quarter.
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