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.