There seems to be no relief for the shareholders of Advanced
Micro Devices, Inc.(NYSE:AMD) as the stock continued to tank in after hours on
Thursday as the company this time trimmed its earnings projections for the
third quarter which ended last month, stating poor demand across all product
lines largely to the challenging macroeconomic environment (which is quite
beneath the control of the company).
The company, whose shares have lost more than 40% so
far this year, said that the revenue for the third quarter is projected to fall
by 10% quarter on quarter basis, that’s a sharp downgrade from the company’s
earlier guidance of 1 percent, plus or minus 3 percent, sequentially. That will
give the company revenue of about $1.29 billion, well below analysts’ target of
$1.38 billion.
There are more bad news, the company now projects
gross margin at 31%, again may be not be comparable to past forecast of 44% “due
to an inventory write-down of approximately $100 million due to lower
anticipated future demand for certain products” and “weaker than expected demand
which contributed to lower than anticipated average selling prices (ASPs) for
the company’s Computing Solutions Group products and lower than expected
utilization of its back-end manufacturing facilities.”
Advanced Micro Devices’ shares have been heavy
pressure recently as the shift from PC to tables or Smartphones are hurting the
company’s business significantly. Moreover, today’s surprise came in after
yesterday’s worse-than-expected
Q3 PC numbers.
Shares of AMD slumped 7.20% to $2.97 in after hours
session.
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