Advanced Micro Devices Inc. Wednesday reported a 96 percent rise in sales and a profit after a year-earlier loss, but the chip maker’s stock fell after it forecast only a moderate rise in revenue.
AMD’s sales forecast was “far less” than what was expected, said Allan Mishan, an analyst with CIBC World Markets, saying it was a sign AMD was losing ground to arch-rival and market leader Intel Corp. “Clearly they’re losing share,” said Mishan.
In its second quarter, the Sunnyvale, California-based company reported a profit of $32.2 million, or 9 cents a share, compared to a year-earlier loss of $140.1 million, or 40 cents a share.
Second-quarter sales rose to $1.26 billion from $645 million a year earlier. Wall Street had been expecting a second-quarter profit of 9 cents on revenue of $1.24 billion, according to a survey of analysts by Reuters Estimates.
On Tuesday, Intel posted an 18 percent rise in quarterly revenue but warned that inventories of unsold and unfinished products grew sharply and that profit margins would be weaker than expected for the year.
For the third quarter, AMD said it expected sales to rise ”moderately.” Analysts had expected a revenue increase to $1.34 billion.
AMD and Intel are pitched in a heated battle for market share in both computer microprocessors and flash memory chips used in mobile phones.
New 64-bit chips introduced by AMD that can process twice as much data at a time as standard chips have sold faster than some estimates, though Intel recently countered with its own 64-bit chip for low-end computer servers.
AMD said sales in its memory business grew by 220 percent in the quarter to $673 million, with revenue growing in all major regions. The company’s computing business saw sales rise 36 percent from a year earlier to $554 million, but a drop of 3 percent from the first quarter.
