AMD, Rival Intel Struggles, 2Q Revenue Up 70%... Stock Falls Amid Disappointing Outlook

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] American semiconductor company AMD showed a sales increase of over 70% in the second quarter (April to June) of this year, but due to a slowdown in PC demand, its third-quarter (July to September) performance is expected to fall short of market expectations, causing its stock price to plummet.

According to Bloomberg and other sources, AMD announced its second-quarter results and third-quarter guidance on the day, reporting second-quarter sales of $6.55 billion (approximately 8.6 trillion KRW), a 70% increase compared to the same period last year. Earnings per share were $1.05. Both sales and earnings per share exceeded market estimates of $6.53 billion and $1.03, respectively.

During the second quarter, AMD showed growth in all four major business segments. Data center-related sales recorded $1.5 billion, an 83% increase year-over-year, and client segment sales, including semiconductors for PCs and laptops, increased by 25% to $2.2 billion.

The problem lies in the third quarter. AMD forecasted third-quarter sales of $6.7 billion. The market expected AMD’s third-quarter sales to exceed $6.8 billion. Lisa Su, AMD’s CEO, stated that the PC sales outlook is more conservative than expected, predicting that the PC-related business will decline by the mid-teens percentage during this quarter. On an annual basis, PC market shipments are expected to record a single-digit high teens decline.

Following the earnings announcement after market close, AMD’s stock price dropped nearly 7%.

Earlier, American semiconductor company Intel reported second-quarter sales of $15.3 billion, a 22% decrease compared to the same period last year. The market had expected Intel’s sales to be around $18 billion, but the actual figure fell significantly short, leading to an 'earnings shock' evaluation. Intel also lowered its annual sales target for this year to $65 billion to $68 billion, 13% lower than the previous year, reducing the target by $11 billion from the forecast announced in April. For the third quarter, Intel expects sales of $15 billion, significantly below the market estimate of $18.7 billion.

This content was produced with the assistance of AI translation services.