AMD warns of third quarter revenue shortfall on weaker PC demand, supply chain issues

Lisa T. Su, CEO of Advanced Micro Devices

Adam Jeffrey | CNBC

AMD Published preliminary third quarter results Thursday which are well below his initial forecasts.

The company reported preliminary quarterly revenue of approximately $5.6 billion. He originally said he expected $6.7 billion in revenue for the quarter, plus or minus $200 million. AMD also said its non-GAAP gross margin is expected to be around 50%, whereas it previously expected gross margin to be closer to 54%.

The shares fell more than 3% in after-hours trading.

AMD said the shortfall was a combination of a “weaker-than-expected PC market and significant inventory correction actions throughout the PC supply chain.”

In its last quarterly results, AMD had already given a forecast for Q3 which was below Wall Street expectations.

AMD’s Client segment revenue was about $1 billion, the company said, down 40% year-over-year. Its Gaming segment generated approximately $1.6 billion in revenue, up 14% year-over-year, and its Data Center business also generated approximately $1.6 billion in sales for the quarter, up 45% year over year.

The rise of its Embedded business AMD’s Embedded business, which primarily results from acquisition of Xilinx earlier this year generated around $1.3 billion.

In total, sales of $5.6 billion were up 29% from the third quarter of 2021, but down 15% from last quarter.

Overall, the stock is down about 53% for the year while the S&P 500 is down more than 21%.

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