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© andrzej thiel dreamstime.com Components | October 12, 2012

AMD expects sequential revenue decrease

AMD now expects revenue for the third quarter ended September 29, 2012 to decrease approximately 10 percent sequentially.
The company previously forecasted third quarter 2012 revenue to decrease 1 percent, plus or minus 3 percent, sequentially.

The lower than anticipated preliminary revenue results are primarily due to weaker than expected demand across all product lines caused by the challenging macroeconomic environment.

The company now expects third quarter gross margin to be approximately 31 percent; less than the previous expectation of approximately 44 percent primarily due to an inventory write-down of approximately $100 million due to lower anticipated future demand for certain products.

Third quarter gross margin was also negatively impacted by 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.

Operating expenses for the third quarter are expected to decline approximately 7 percent sequentially as a result of tightly controlled expenses in the quarter.

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